CIS DRS

CASE: DEBT COLLECTION IN EUROPE FOR CREDITOR FROM CHINA

Creditor:

Platform for hotels to attract traffic and reservations
Debtor:

Customers
Case type:

Global B2B debt portfolio
Our client is a worldwide supplier of shoes and is one of the leading sellers of listed products, based in China. The Debtor’s company is one of Europe’s leading fashion retailers. They have over a thousand stores in up to 20 European countries. So their export is tightly related to the network of distribution in Europe. This sounds like a great market to export goods due to sound institutions, power of law and other benefits. However, business is connected with risks. Overdue receivables became an issue to our valued client.

Typical debt collection case may look like the following. Debtor (a local seller) entered into the agreement with the creditor (from China). Creditor is an international chain with many brands. Once shipment has been made the debtor should pay the necessary invoices. However, the debtor made a very slight delay in payment for the delivered products and our team was hired to investigate the opportunity to pay timely. After the investigation we reported to the creditor regarding the issues and the debtors’ reply. Being happy with the report, the creditor has assigned the case to us for further collection. It became a complex project due to the necessity to save the relationships between parties and to arrange timely payments.

Our team gathered all necessary information about the debtor and carefully studied the available trade documents. Our lawyers have developed the collection workflow. It included the following: letters of demand, communication scripts, information search algorithms, negotiation strategies, language peculiarities, data transfer and other compliance issues.
It should be also noted that the most important part has been agreed - the reporting standard. Client timely receiving all necessary reports regarding the collection progress. Moreover, additional analysis and statistics helped to upgrade the financial control process and underwriting assessment. Following excellent client service as a value, our teams have advised the client regarding improvements in their interactions with their debtors to reduce the risk of defaults.

Our lawyers managed to convince the debtor's management to pay overdue invoices as soon as possible in order to continue cooperation with the supplier. As a result our client received USD 312K within three weeks.
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