Recovering a debt

Unfortunately sometimes businesses have the occasional customer who might default on paying an invoice. BBX can be used as a mechanism to help recover a bad debt. Before the debt becomes unrecoverable you can offer to take part or all the outstanding amount due in your customer’s goods or services. You can then sell the inventory through the BBX network, turning what might be an unrecoverable debt into BBX pounds.

Here is an example of how this worked for a local magazine.

A retail shop couldn’t afford to pay for their latest advertising campaign which was £3,000 for the quarter. The magazine knew that the retailer was struggling with cash-flow and there was the possibility of the business going bust before the outstanding debt could be paid. So the magazine took payment for the outstanding debt in unsold stock from the retailer to the value of £3,000. They then passed the stock onto their BBX account manager to sell in the network and turn into BBX money.

The Net result being:

• The magazine received payment in full before, and retained their customer that would continue to pay as normal when times got better.
• The retail shop is happy because they cleared a debt when they may have needed to close up shop AND they received new customers buying their unsold stock.
• The BBX network received new product that wasn’t available before that other business could benefit from.

Clearing a debt

Sometimes a business falls on hard times and can’t afford to pay their bills. Before the situation becomes unrecoverable the business owner could offer to clear all or part of the bill by paying for an expense on behalf of the supplier or inviting them to join BBX.

Here is an example of how this worked for a restaurant.

A fruit and veg supplier had been supplying a well known Italian restaurant for 26 years however there was a £6,000 build up of unpaid invoices and the latest set back made it impossible for the restaurant to pay. BBX spoke to the F&V supplier and got them to agree to take the outstanding £6,000 in BBX.

The Net result being:

• The F&V supplier received payment in full and retained their customer that would continue to pay as normal when times got better.
• The restaurant is happy because they cleared a debt when they may have needed to close the business.
• The BBX network received new product that wasn’t available before that other business could benefit from.

Alternatively the F&V supplier didn’t have to open a BBX account but instead the restaurateur could have paid for an expense on behalf of the supplier to the same value. For example the F&V supplier wanted an all singing and dancing eCommerce website which the restaurateur could pay for with BBX in lieu of the cash debt.

Similar tips: See winning cash contracts.

Need further explanation or you would like to know how to implement in your business? Call your account manager on 0333 400 2014 or request a call back below.