Debt Collection: 100% of debt, plus interest, recovered from large listed technology company Written by Kaizen Enterprises Pty Ltd
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Case Studies

 

Client: Software distributor (ASX Listed)

Project: To collect $360,000 owed by a major listed technology company

Service: Debt Collection

Key achievements:

  • Face-to-face meeting with the debtor company’s financial controller
  • Successfully negotiated payment of interest
  • Full repayment of $360,000, plus interest

Synopsis:

Kaizen Enterprises was engaged by a long-established listed national software company to collect $360,000 owed by a major listed technology company. The debt was more than a year overdue, and there had been disputes raised about the quality of the services rendered.

To help determine the strength of our client’s claim, we interviewed several engineers involved in the project and concluded that the allegations of poor quality service were an excuse to delay payment. Our research also revealed the debtor company had a waning share price and sluggish sales, suggesting that the company was having cash flow problems.

We decided to request interest of $13,400 in addition to the original monies owed, as the debt had been due for over a year. We contacted the debtor company’s Chief Financial Officer three times over five days, and he did not reply.  On day six, our principal, Ian James, attended the company’s head office, without an appointment, and asked to see the CFO. Ian was told to wait, and after less than an hour was seen by the CFO.

He explained that he was visiting because the CFO had not returned the three earlier phone calls; something which he hoped would put the CFO on the back foot.

The CFO acknowledged both the debt and the unreturned calls, but balked at paying interest and offered a counter-proposal of post-dated cheques and interest calculated for just two months. However, Ian insisted that this element of the debt was non-negotiable. Ian and the CFO then agreed to a repayment schedule of $100,000 per week.  The CFO provided a cheque for the first $100,000 on the spot, and subsequently provided the agreed post-dated cheques for the agreed schedule, including the full interest amount.