Navigating Financial Risk In A Rebounding Economy
 

Navigating Financial Risk In A Rebounding Economy

on

  • 5,319 views

A rebounding economy and construction market can be financially hazardous because it presents increased cash needs to a cash poor marketplace. How do you grow your business in the improving conditions ...

A rebounding economy and construction market can be financially hazardous because it presents increased cash needs to a cash poor marketplace. How do you grow your business in the improving conditions without committing financial suicide?

This presentation answers this question by analyzing your company’s credit risk strategies and credit procedures. How you prepare for the risk of non-paying accounts and then respond to such accounts is the key to a healthy bottom line.

The presentation will highlight best practices in the industry and case studies, and answer questions about the costs and benefits of various available legal options when you’re looking to get paid.

Statistics

Views

Total Views
5,319
Views on SlideShare
4,822
Embed Views
497

Actions

Likes
12
Downloads
15
Comments
0

10 Embeds 497

http://www.zlien.com 444
http://gamon3ziklo.blogspot.com.es 17
http://feeds.feedburner.com 16
http://biologiayfisica2013.wikispaces.com 10
http://www.onlydoo.com 2
http://feedly.com 2
http://www.linkedin.com 2
https://twitter.com 2
http://www.google.com 1
http://gamon3ziklo.blogspot.com 1
More...

Accessibility

Upload Details

Uploaded via as Adobe PDF

Usage Rights

© All Rights Reserved

Report content

Flagged as inappropriate Flag as inappropriate
Flag as inappropriate

Select your reason for flagging this presentation as inappropriate.

Cancel
  • Full Name Full Name Comment goes here.
    Are you sure you want to
    Your message goes here
    Processing…
Post Comment
Edit your comment

Navigating Financial Risk In A Rebounding Economy Navigating Financial Risk In A Rebounding Economy Presentation Transcript

  • Navigating Financial RisksIn A Rebounding Market
  • “Sudden Rise In HomeDemand Takes Builders BySurprise.”http://zlien.us/12fN9Jv
  • “Homebuilding busiestsince 2008.”http://zlien.us/18XnIi9
  • “Construction is the brightspot for recoveringeconomy” http://zlien.us/18Xo3RR
  • Should You BeScared Of AnImproving Market?
  • Part 1: Why A Recovery Carries RiskPart 2: The Metrics That MatterPart 3: Be Proactive with Credit RiskPart 4: Know Your Options
  • “No one liked the recession,but some contractors are goingto hate the recovery, too.”Thomas Schleifer, Ph.DDel E. Webb School of ConstructionENRViewpoints: Beware The Recovery
  • “The construction market isgoing to be a financial strugglefor most contractors becausegrowth eats cash and manyhave been straining financiallyduring the unprecedenteddownturn.”Thomas Schleifer, Ph.DDel E. Webb School of ConstructionENRViewpoints: Beware The Recovery
  • Financial Struggle ToMeet Cash DemandsWith Small CashReservesLong Recession MadeCompanies Cash PoorStrong Economy WillRequire CompaniesTo Grow Into NewDemandGrowth Eats Cash
  • 0%25%50%75%100%YEARS: 1 2 3 4 5failure ratesRecovery Makes Things Worse3xWORSE DURINGRECOVERYTHAN DOWNTURNENRViewpoints: Beware The Recovery
  • debt ratios0%10%20%30%40%50%E-Commerce Suppliers0%25%50%75%100%YEARS: 1 2 3 4 5failure ratesDebt Ratios: Aswatch Damondaran, NYU Sternhttp://pages.stern.nyu.edu/~adamodar/New_Home_Page/datafile/dbtfund.htmFailure Rates: Small Business Trends, Scott Shanehttp://smallbiztrends.com/2012/09/failure-rates-by-sector-the-real-numbers.htmlConstruction Industryis Already Risky
  • Part 1: Why A Recovery Carries RiskPart 2: The Metrics That MatterPart 3: Be Proactive with Credit RiskPart 4: Know Your Options
  • Expect YourCustomers To HaveCash Flow Challenges• Bad Debt• Aging Receivables• Days Sales Outstanding
  • Waiting For Retainage Can Add Up
  • Back Charges &Little ConcessionsAdd Up Too
  • Part 1: Why A Recovery Carries RiskPart 2: The Metrics That MatterPart 3: Be Proactive with Credit RiskPart 4: Know Your Options
  • Don’t Gamble
  • Know who you expect to pay you.Do Your Homework
  • Rule #1The Longer YouLet An AccountSit, The HarderIt Is To Collect.
  • Rule #2It’s FlippingExpensive ToCollect Old Debt,& Probably NotWorth It.
  • Understand Your Terms of Payment. Stick To Them.Set And Stick To Terms
  • Credit Risk Low- Protect Lien RightsCredit Risk Medium- Protect Lien Rights- Get Personal GuarantyCredit Risk High- Protect Lien Rights- Get Personal Guaranty- Joint Check Agreementor Letter of Credit
  • http://zlien.us/credit-policies
  • Smart CompaniesAlways SendPreliminary Notices
  • Legal Nuances:• Pay When Paid• Pay If Paid• Retainage• Delay• Liquidated Damages• Indemnity Clauses• Lien Waivers• Change Directives
  • Part 1: Why A Recovery Carries RiskPart 2: The Metrics That MatterPart 3: Be Proactive with Credit RiskPart 4: Know Your Options
  • Know The CollectionTools Available To You
  • Plan Your Collections &Legal Procedures Like AConstruction Project
  • Secure your debt witha mechanics lien orbond claim.
  • 1) Prioritize Your Debt In Event Of Bankruptcy2) Claim Job site As Collateral3) Skip Your Client And Sue Third Parties
  • Don’t Just Wait.Follow Up.Prioritize Your Debt.
  • • 2 Emails Per WeekFor 6 Weeks• Credit & CollectionPolicy Tips• How SuccessfulCredit ProfessionalsIncrease RevenueAnd Decrease RiskFree!http://zlien.us/6week-creditpro
  • Questions?