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Small Business Creditor Presentation 021010


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How Creditors can expand their small business outreach efforts and maximize recovery

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Small Business Creditor Presentation 021010

  1. 1. How Creditors Can Expand Their Small Business Outreach Efforts And Maximize Recovery February 2010
  2. 2. <ul><li>The Economy has devastated Small Businesses in 2009. </li></ul><ul><li>Credit Lines have been cut for all but the most credit worthy businesses. </li></ul><ul><li>Domino effect - thousands of businesses are closing. </li></ul><ul><li>Huge revenue losses. </li></ul><ul><li>Small businesses are reducing expenses and many need to deleverage. </li></ul>Small Businesses Are Hurting Part One: Overview
  3. 3. Small Business Center Some Larger Corporations Are Making An Effort To Respond Part One: Overview
  4. 4. <ul><li>Budgeting tools </li></ul><ul><li>Educational materials </li></ul><ul><li>Financing options </li></ul><ul><li>External business consultants </li></ul>What Kind Of Services Do They Offer For Small Businesses? Part One: Overview
  5. 5. <ul><li>If a business owner owes multiple creditors, has judgments, etc, financing is probably not possible. </li></ul><ul><li>A consultant can do little to help this business. </li></ul>“ Our counselors will work with a company to develop an overall plan, but if the company has limited cash flow and is seriously in debt, there is little we can do.” - Ken Yancey CEO SCORE. Counselors to America’s Small Businesses Do Any Of These Options Help A Business Owner With Serious Debt? Part One: Overview
  6. 6. <ul><li>None of their educational materials include negotiating small business debts. </li></ul><ul><li>We’ve co–branded guides with the Association of Small Business Development Centers (ASBDC) and SCORE to help small business owners get out of debt on their own and understand common mistakes in business debt negotiation. </li></ul><ul><li>Can these guides help? </li></ul>What About Their Educational Materials? Can they help a struggling small business? Part One: Overview
  7. 7. <ul><li>If a small business owner wants to pay his debts but can’t afford to, there are currently very few realistic and affordable options available in today’s market. </li></ul><ul><li>That’s why Corporate Turnaround is considered a crucial part of any collection strategy. </li></ul>How Can You Help A Struggling Customer Stay In Business And Pay It’s Debts? Part One: Overview
  8. 8. <ul><li>Our program is designed to help small businesses with serious cash issues </li></ul><ul><li>satisfy their creditors, keep their business open and avoid bankruptcy. </li></ul><ul><li>We help resolve their delinquent debts by: </li></ul><ul><li>Establishing a monthly budget which they can realistically afford to pay. </li></ul><ul><li>Prioritizing the debts based on the leverage of each of their creditors. </li></ul><ul><li>Negotiating repayment terms with the creditors within the available budget. </li></ul>Corporate Turnaround’s Debt Restructuring Program Part Two: What We Do
  9. 9. Deadbeats Our Customers Slow Payers Dead & Dying <ul><li>Able to pay – Unwilling to pay </li></ul><ul><li>Description: These debtors will not pay voluntarily – only when forced to pay </li></ul><ul><li>Action: Litigate </li></ul><ul><li>Unable to pay – Unwilling to pay </li></ul><ul><li>Description: These debtors are out of business or will be soon </li></ul><ul><li>Action: Close the file </li></ul><ul><li>Unable to pay – Willing to pay </li></ul><ul><li>Description: Debtors with serious financial problems who are looking for a viable way to pay their creditors based on what they can afford </li></ul><ul><li>Action: Refer these files to CT </li></ul><ul><li>Able to pay – Willing to Pay </li></ul><ul><li>Description: As long as they are paying, they are part of this group, regardless of difficulty </li></ul><ul><li>Action: Keep collecting </li></ul>OPPOSITES In Order to Effectively Collect, Creditors Needs to Determine the Type of Debtor That Would Benefit From Debt Restructuring Part Three: Identifying Candidates
  10. 10. Which Delinquent Businesses Are Candidates For Our Program? Delinquent Businesses that: Part Three: Identifying Candidates <ul><ul><li>Have under $20MM in annual revenues. </li></ul></ul><ul><ul><li>Want to pay their debts right now, but cannot afford to. </li></ul></ul><ul><ul><li>Have not paid. </li></ul></ul><ul><ul><li>Break payment plans. </li></ul></ul><ul><ul><li>Bounce checks. </li></ul></ul><ul><ul><li>Frequently ask you for extensions. </li></ul></ul><ul><ul><li>Take your call, but never send payments. </li></ul></ul><ul><ul><li>Want to stay in business. </li></ul></ul><ul><ul><li>Are out of options. </li></ul></ul><ul><ul><li>Are running out of time. </li></ul></ul>
  11. 11. Benefits To a Creditor’s Delinquent Customers Our Debt Restructuring Program can help small businesses: <ul><ul><li>Spend less time dealing with creditors, collection agencies and attorneys. </li></ul></ul><ul><ul><li>Satisfy creditors with what they can afford. </li></ul></ul>Part Four: Benefits to a Creditor’s Customers <ul><ul><li>Reduce the debt and/or stretch it out over time. </li></ul></ul><ul><ul><li>Reduce or eliminate unnecessary legal costs. </li></ul></ul><ul><ul><li>Keep businesses open and avoid bankruptcy. </li></ul></ul>
  12. 12. When you introduce a debtor to Corporate Turnaround that becomes a paying client, there are four crucial benefits to our: Creditor Alliance <ul><li>If you are holding any type of lien on assets such as equipment vital to the survival of the debtor’s business - CT can help the debtor to restructure the debts of the subordinated creditors therefore reducing your need to liquidate the asset. </li></ul><ul><li>If you are holding any type of lien on assets which are not vital to the survival of the debtor’s business or you are an unsecured creditor - Our Highest Priority Creditor Program helps debtors pay you favorably ahead of other creditors. As the Highest Priority Creditor, you will receive settlement offers before the other creditors, and your offers will be more favorable than those received by the other creditors. </li></ul><ul><li>You will gain valuable information about the debtor at no cost to you - Even if the debtor chooses not to use our services, you’ll know how to proceed on the debt for the best chances of recovery. </li></ul>What Value Does a Creditor Get From Our Debt Restructuring Program? <ul><li>You won’t pay us any collection costs or legal fees - We make our money from the debtor, not you. You can get paid from accounts that probably could not have paid you otherwise. </li></ul>Part Five: Benefits to a Creditor
  13. 13. Summary Of Benefits To a Creditor <ul><li>Collect the uncollectible. </li></ul><ul><li>Help prevent or forestall liquidation of highly secured assets by introducing a credible resource to the debtor being aggressively pursued by subordinated creditors. </li></ul><ul><li>Enjoy the best payment terms of all creditors in the restructuring. </li></ul><ul><li>Introduce an alternative to bankruptcy to the debtor. </li></ul><ul><li>Get additional insight and information about debtors you are trying to collect from. </li></ul><ul><li>Offer help to debtors that would pay if they could. </li></ul><ul><li>We never charge you anything. Our fees are paid by our clients. </li></ul>Part Six: Summary
  14. 14. <ul><li>Money Is Tighter Than Ever </li></ul><ul><li>For America’s Small Businesses   </li></ul><ul><li>Through our debt restructuring program, a Creditor can: </li></ul><ul><ul><ul><li>Expand on small business outreach efforts and help struggling small businesses. </li></ul></ul></ul><ul><ul><ul><li>Provide your collectors and recovery specialists with an additional way to get paid. </li></ul></ul></ul><ul><ul><ul><li>Introduce a credible resource to your struggling small business accounts . </li></ul></ul></ul><ul><li>Here’s how to get started: </li></ul><ul><li>Call me at 800.411.1113 Ext 4142 </li></ul><ul><li>We’ll review your parameters and proceed from there. </li></ul><ul><li>Patrick McGahren </li></ul><ul><li>V.P. - Business Development </li></ul><ul><li>Corporate Turnaround </li></ul>