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ContemporaryVA Case Study: Solutions for Accounts Receivables

PROBLEM: “E.L.” owned an international business that performed services for clients around the world and then invoiced them for the work. Unfortunately, he had more than $200,000 (USD) in pending receivables from clients in the United States, Canada and Latin America. The accounts ranged from 60 to 120 days old, and each passing day made them increasingly difficult to collect on.

E.L. had hired a collection agency, which charged him 30% of what they collected. The agency collected money from the US and Canadian clients with good results. However, a couple of issues combined to make collection from Latin American clients extremely difficult:

  • Letters were sent but never responded to (perhaps because of an inefficient postal service).
  • Phone calls were intermittently successful but poor connections, language barriers, and disconnected lines added to the challenge.

In short, E.L.’s collection agency was effective for some of the work but wasn’t able to complete the job.

SOLUTION: E.L. contacted ContemporaryVA to assist with the Latin American clients. ContemporaryVA provided a highly trained virtual assistant to help. Rather than paying a 30%-per-collected fee rate, he simply hired them at an hourly rate. Using their experience with Latin American finance and customer service, they were able to connect with the appropriate people in a timely manner. They arranged courier pick-ups, facilitated bank transfers and international deposits, and they even found errors that were the result of E.L.’s inaccurate record-keeping.

RESULT: On average, ContemporaryVA collected $5,000 to $10,000 weekly from E.L.’s Latin American clients and did the work in less than 20 hours. If the collection agency had collected the money, they would have charged E.L. 30% – between $1500 and $3000 – but ContemporaryVA’s reasonable hourly rate totaled just $300 in that period.

Additionally, E.L.’s client relationships were preserved because ContemporaryVA’s professional, respectful, yet persistent approach was effective at collecting the money while maintaining a positive customer service approach.

Posted on August 21st, 2009 by Rachel Braam, Office Manager

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