Delta Recovery Systems Newsletter
Delta Recovery Systems, a Worldwide Collections Agency September 2005
In This Issue


 
CEO Moment

"Experience is not what happens to you. Experience is what you do with what happens to you."

Aldous Huxley

Aldous Leonard Huxley was born on July 26, 1894, into a family that included some of the most distinguished members of that part of the English ruling class made up of the intellectual elite. Aldous' father was the son of Thomas Henry Huxley, a great biologist who helped develop the theory of evolution. His mother was the sister of Mrs. Humphrey Ward, the novelist.

Huxley wrote Brave New World in four months in 1931.

Undoubtedly, Huxley's heritage and upbringing had an effect on his work. Gerald Heard, a longtime friend, said that Huxley's ancestry "brought down on him a weight of intellectual authority and a momentum of moral obligations." Throughout Brave New World you can see evidence of an ambivalent attitude toward such authority assumed by a ruling class.

In 1937, the Huxleys came to the United States; in 1938 they went to Hollywood, where he became a screenwriter (among his films was an adaptation of Jane Austen's Pride and Prejudice, which starred the young Laurence Olivier).

In the 1950s Huxley became famous for his interest in psychedelic or mind-expanding drugs like mescaline and LSD, which he apparently took a dozen times over ten years. Sybille Bedford says he was looking for a drug that would allow an escape from the self and that if taken with caution would be physically and socially harmless.

He put his beliefs in such a drug and in sanity into several books One work centering on drugs and sanity was Island (1962), a novel that required 20 years of thought and five years of writing. Among other things, Island was an antidote to Brave New World, a good Utopia.

Huxley produced 47 books in his long career as a writer. The English critic Anthony Burgess has said that he equipped the novel with a brain.

He also wrote an early essay on ecology that helped inspire today's environmental movement. He died November 22, 1963, the same day that President John F. Kennedy was assassinated.

"Experience is not what happens to you. Experience is what you do with what happens to you."

Just a thought to keep in the back of your mind the next time you are reviewing your aged trial balance.

“Truth, like surgery, may hurt, but it cures.”

I have no idea who said that, but I like it.

David Ward, CEO
Greetings

Fall is almost here, and this month we're going to fall back in time with novelist and screewriter Aldous Huxley. We'll also tackle the issue of when is the right time to place accounts for collection, and we'll offer some tips to make the outsourcing process more efficient and effective. As always, we welcome any comments, suggestions and/or questions you may have concerning our newsletter and industry issues in general.

Comments, Suggestions and Feedback
Your debtor may not have enough money to pay all of their debts, but they can pay some (and they usually pay those creditors who are most persistent!).

We are often asked “When do I turn an account over to an Agency”? There is no answer cast in stone. There simply are no hard and fast rules about when to turn an account over to a collection agency. Collection agencies do a great job of describing why trade creditors should entrust their delinquent and uncooperative accounts to them, but no one has yet devised any universally applied rules about when and why to place an account for collection. The following aren’t rules, just guidelines. However, Credit Managers should seriously review an account for placement when the following conditions exist alone, or in combination:

  • A customer has bounced checks to you or other vendors.
  • The customer refuses to replace the bounced check.
  • The creditor is no longer making progress toward clearing the unpaid balance.
  • The customer will not take your calls.
  • The customer will not return your calls.
  • The account is 90 days or more past due.
  • Federal or state tax liens have recently been placed on the debtor company.

 
  • There is significant employee turnover in the company, especially among senior employees.
  • The customer has broken two or more commitments to pay the past due balance.
  • The customer promises to pay one amount, but pays significantly less.
  • The debtor refuses to acknowledge the balance due in writing.
  • The customer proposes a payment plan, but refuses to sign a Promissory Note.
  • The debtor is considering filing for bankruptcy protection.
  • The customer is changing banks.

  • The debtor is in violation of its bank loan covenants.
  • The delinquent customer cannot pay until arrangements with a new bank are settled.
  • The bank has frozen the customer's account.
  • The debtor issues a check drawn on a closed account.
  • The company was recently sold.
  • There was a bulk sale of assets.
  • The customer has proposed a payment plan to trade creditors as an alternative to a bankruptcy filing.

  • A customer asks you to speak with their "work- out" specialist.
  • When you threaten to place the customer for collection, and they seem unconcerned.
  • The customer's phone is disconnected.
  • Your mail is returned.
  • When there has been an ownership change and the new owner claims not to be responsible for the debts of the former owner(s).
  • If you cannot reach a decision maker.
  • You cannot get a reasonable commitment for payment from the decision maker.

 
  • You learn the customer is being sued by other trade creditors.
  • The account has been placed for collection by other trade creditors.
  • The business is for sale.
  • You are offered payment only after the sale is completed.
  • Creditors that once sold the customer on open- account terms now sell on COD terms.
  • There is significant deterioration in payments to creditors.
  • The debtor company does not respond to a final demand for payment.
With rare expection, your collection referrals are on a collector's desk on the day of referral. Our data entry specialists are fast and efficient! What does it take to get a collector on the case so fast.
  • Electronic referrals - we can upload your spreadsheeted referrals in minutes.
  • Forward a copy of the entire file with the referral.
  • A completed Account Placement Form - we can provide a customized version for you!
  • Create and adhere to your own internal procedures for referring collection accounts.
  • Contracts, personal guarantees, references and solid vendor files.

Our best clients have a strong internal collection policy that allows for their own efficient in house collections and the ability to easily refer the delinquent accounts that need our assistance.