Collections Made Easy
In this sluggish economy, it’s not uncommon for you as a business owner to be carrying some bad debt on your books. Whether you are a landlord with a slow-paying tenant or a provider of some other B2B product or service, the decision to get tough with your customer in order to collect a delinquent account can be difficult. You know that the outcome will not be favorable for your relationship with your customer and it probably won’t help you get paid any sooner either. The decision to sue and get a judgment or evict a tenant is a no-win proposition. But, what are the alternatives?
Equitrade International, Inc. provides a solution that can both get you paid in full and heal your relationship with your customer. With the implementation of barter finance, Equitrade can collect your receivable from your customer in a form that is advantageous to your customer, while also providing you with a host of other benefits.
The inability of your customer to pay their bills is a result of a lack of cash flow. However, it’s probably safe to say that in the absence of sales and cash flow that there exists an abundance of excess capacity. Equitrade provides a way for your customer to tap that excess capacity and pay their delinquent account with a future sale from a customer that they don’t even have to find.
How it Works
As a barter finance facilitator and third-party record-keeper, Equitrade provides liquidity to barter transactions. If your customer qualifies for the program, Equitrade arranges for them to settle their balance with you in the form of gift certificates from their place of business. These gift certificates are then deposited into a larger pool of goods and services from other clients that have used barter finance to lease commercial space, make acquisitions, and expand their business. You receive an equivalent amount of barter credits in your own account to spend for products and services that you need. Equitrade has access to over 100,000 businesses across the country to source the items that you need.
How Does Your Customer Benefit?
When your customer settles their debt with you by issuing gift certificates on their business, they offset cash that they otherwise would owe with a future sale from a yet unknown customer. Equitrade sends them the new customers to redeem the gift certificates. These new customers are other Equitrade clients that have used their barter credits for items that they need and want in lieu of cash that they might have spent.
Gift certificates become a marketing campaign all of their own to generate new sales for your customer and help nurture their troubled business back to health. Here are a few ways gift certificates contribute to a business’ success:
The benefit is received today. Gift certificates are redeemed in the future.
The gift certificates are redeemed by new customers sent by Equitrade.
No change is given, any overage is paid in cash by the customer
Gratuities are paid in cash, where applicable.
Referrals from new happy customers bring in more cash business.
With a major debt now settled without any further impact to your customer’s cash flow, they can now focus on getting their business back on track. The relief from the stress of being in debt can be liberating and now your customer can begin again with a fresh start towards positive cash flow.
How Do You Benefit?
Now that you have recovered your bad debt in full and have salvaged a potentially lost customer, what do you do with those barter credits in your account? Your Equitrade account is like any other bank account that you may have, the difference being that you can’t withdraw cash at an ATM. By working closely with your Equitrade broker, you will learn to use your Equitrade account first before you write a check for virtually anything that you need to operate your business. When you spend your barter credits instead of cash, they convert to cash because you keep the cash that you might otherwise have spent.
The time, money and aggravation that you would normally spend trying to collect a delinquent account can now be better spent with revenue producing activities. Equitrade saves you money by turning a problem into a solution for both you and your customer and by preventing another lost account or vacant space. And, by selling your bad debt account to Equitrade you convert an aged collection item, which reflects negatively on your financial statement, to a positive asset account balance to be used at your discretion to offset real expenses and conserve cash. Better yet, without a bad debt expense to write off, your budgeted allowance for bad debt drops right to your bottom line.