The Restaurant Failure Risk is Real
If you are supplying goods, equipment or services to food, beverage and restaurant industries, you MUST take steps to secure your receivables. These industries are historically the riskiest industries for creditors. In fact, the National Restaurant Association estimates that one in three restaurants won’t survive their first year.
As a creditor supplying goods, equipment or services to the foodservice industry, how can you reduce your credit risk? UCCs.
UCC filings through NCS Credit help provide an opportunity to collateralize or “secure” your goods and/or accounts receivable by leveraging the personal property assets of the customer. Properly perfected security interests via UCCs will help mitigate risk and ensure filings maintain compliance.
Education Center
No Lien Rights for Rental Equipment Companies in Pennsylvania
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We had a situation with a large volume customer with no personal guaranty who closed their doors unexpectedly…leaving us with a past due balance of $189,000…Without us being a secured creditor with a UCC filing in place, I truly believe that we would have only received cents on the dollar under the unsecured general creditors. Sysco Boston has been paid due to the utilization of the UCC and the services of NCS. NCS makes this process easy.
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I just wanted to pass along a success story from using the UCC filing process with NCS. We avoided losing $85,927 because we used a UCC to secure our receivables. Our customer was selling their restaurant and the sale was initially turned down because of the UCC filing. The customer had a history of returned checks. When they discovered the lien, they asked us to terminate it so they can proceed with the sale. We explained we could not do that without being paid. This resulted in us collecting the full amount of $85,927 that otherwise would have taken us probably a year to collect! The UCC process is certainly a great tool that gives us the leverage we would have never had.
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We were notified that a customer was selling a location which at the time had an AR in the mid-six figures, all of which was past due…The sale took place and our Credit Manager was contacted by the attorney who had the check in hand for the full amount. Had we not had the UCC filing in place we would not have received this payment and very likely, only cents on the dollar.
This success paid for the cost of filing previous UCC’s and future UCC filings for years to come. This was definitely a win when looking at the cost benefit/ROI for securing our receivables with the UCC process and utilizing the services of NCS.
Our broad network helps us help you
Each industry is unique, with its own set of risks and challenges. Our expertise is vast, our resources are bountiful, and our experience has provided us the opportunity to develop and refine tailored and successful solutions, for credit professionals just like you. Whether you need to improve your cash flow and work capital, reduce bad debt write-offs, or simply need to free up your credit department’s time, our team is prepared to ensure you are in the best possible position to get paid.
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