Case study: FMCG sector
Overdue debt was reduced from £1.5m+ to £21k
Invoice finance pre-payment from 80% to 90% in four months
summary
We successfully reduced overdue debt from £1.5m+ to £21k and restored the invoice finance pre-payment from 80% back to 90% within four months, for a food manufacturer.
Facts
A £45 million turnover, fourth-generation family-owned food manufacturing business. It had £12m bank debt, including £6 million on an invoice finance facility. It also had a loss of £13m in its last filed accounts and a survival cash gap of nearly £2m was identified.
The business also had £1.5m+ of overdue debt owed it to due to queries, and a lack of chasing, and its percentage on its invoice finance facility had been reduced to 80% from 90% after issues were discovered on the facility.
actions
itsettled took over the collections process including implementing urgent query resolution to generate cash fast and produced accurate rebate accrual to give the invoice finance provider comfort of offsets. Credit and collections policies and procedures were also written and implemented to prevent re-occurrence.
Alongside the work to transform the ageing profile of the debtor book in a short-time frame, staff changes were also implemented including changing the CFO and throughout the team liaised with all stakeholders including a Turnaround Director who had been appointed by the business’ bank.
Results
Within four months, the overdue debt amount had been reduced to £21,000, with all queries resolved, with £1.2 million generated.
The invoice finance facility was operating as it should and back to 90% pre-payment, plus the business had £600k from the invoice finance uplift percentage.
New policies and procedures had been implemented and were being followed, the business had the right staff in the right positions, and trust had been regained from the bank and invoice finance provider.
Overdue debt recovered
recovered in 12 weeks
our offices
Bristol Office
Credebt Ltd
Trym Lodge
1 Henbury Road
Westbury-On-Trym
Bristol
BS9 3HQ
Manchester Office
Credebt Ltd
82 King Street
Manchester
M2 4WQ
London Office
Credebt Ltd
Hamilton House
Mabledon Place
London
WC1H 9BD
Credebt Limited: Registered in England Number: 6933734 Registered Office: Trym Lodge, 1 Henbury Road, Westbury on Trym, Bristol BS9 3HQ
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