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One North Group has witnessed a concerning rise in insolvencies within the recruitment, haulage, and storage industries. Additionally, we have seen a rise in fraud, predominantly through fresh air and recycled / re-aged invoices. The recruitment sector has been grappling with challenges including skill shortages, rising costs, and regulatory changes. Meanwhile, the haulage industry has faced increased fuel prices, driver shortages, and supply chain disruptions amongst many more headwinds.

These factors have contributed to the financial strain experienced by businesses in all sectors, leading to an uptick in insolvencies. Equally, the banks and typically peer-to-peer funders are reducing their funding appetite and commerciality which then leads to a tightening of options and a fundamental squeeze on cash. Complacency will then see funders targeted to bridge this funding gap.

We have seen firsthand the subsequent knock-on effect through insolvencies, and we are aware of an increase in IF / ABL sector frauds. Early intervention helps to minimise risk and provides more options versus cessation which ultimately impacts recovery.

Debt Recovery Success Story: Haulage and Storage Business

• Problem Debt:

Early identification (pre-administration) of "fresh air" invoicing, helping to mitigate the funder's position and give some clarity to our recovery strategy.

• Support:

Credit control support was flagged as the driver behind the disclosure of the funder's CID facility.

• On-site management:

Efficiently oversaw the repatriation of stocks, in lieu of payment wherever possible and appropriate.

• Paperwork recovery:

Ensuring all available paperwork was captured either electronically or physically to minimise the risk of spurious disputes.

• Comprehensive debt recovery:

Handled all debtor requirements and achieved an impressive recovery rate of over 85% (c£1.725m) within the first 12 weeks.

• Financial recovery:

Collected sufficient funds to ensure the funder was fully repaid, along with wider security.

Impact:

• Reduced financial risk:

Driving cash recovery to help mitigate potential financial losses.

• Enhanced operational efficiency:

The on-site management of stock repatriation streamlined processes and minimised disruptions whilst maximising receipts.

• Sales ledger

Clarity to allow informed decision making.

Overall, this case demonstrates the effectiveness of our wider credit control support morphing into debt recovery services in complex scenarios, such as haulage and storage businesses.

Our team's expertise and dedication were instrumental in securing a positive outcome for the client.

The early identification of significant "fresh air" invoicing helped drive the right strategy to minimise any additional exposure, working closely throughout with all stakeholders to maximise recovery.

Fundamentally, the funder will be fully repaid and there will hopefully be a dividend payment to the creditors.

This was our fifth recent haulage/storage type business, clearly there are continued sector challenges and headwinds.

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• Comprehensive credit control strategies

• On-site logistics and debtor management support

• Effective debt recovery

• Sector issues – how to best mitigate

Discover how our expertise can help you maximise recovery to minimise loss or maximise return for creditors.