Skip to content

Debt Collection Latin America & the Caribbean

We collect your debts. Anywhere

  • Home
  • Acerca de
HomePosts tagged 'Account Receivables Management'

Account Receivables Management

Debt Collection in the Travel Industry

22 December, 2020 admincobroamericas Account Receivables Management, International Business, International Debt Collection Account Receivables Management, Debt Collection, International Business, International Debt Collection, Tourist Industry, Travel Industry

The travel industry is an international business sector of great economic importance. According to Phocuswright, global travel industry gross bookings reached US$1.6 trillion in 2017. As per the same research, travel and tourism accounts for 10.2 percent of global GDP. This makes the travel industry one of the largest and fastest growing sectors in the world.

The travel industry is the first in a series of blog posts about account receivables management for international business sectors.

How to Describe the Travel Industry

Debt Recovery Travel BusinessAs per Revfine, the travel industry is concerned with providing services related to travel from one location to another. This includes services that are directly related to the travel itself, such as transportation, but also includes services related to catering for travelers’ needs and wants after they have arrived at their destination.

The travel industry includes the tourism industry, which relates to the industry centered on tourism, being the specific act of travelling to a different location, either for business or pleasure. 

The travel industry may include service providers in (1) transportation: like the airline industry and car rental, (2) accommodation: like hotels, campings, bed & breakfast and shared accommodation, (3) food & beverage: like restaurants and bars, (4) entertainment, and (5) connected services: like financial services (travel insurance and travel medical plans, for example), (online) travel agencies and tour operators.

Another crucial type of service provider in the travel industry are the digital booking platforms.

Debt Collection in the Global Travel Industry

To effectively collect debts in the global travel industry, it is important for the debt collector to take the following into account. 

Understanding the Travel Industry

Account Receivables Travel BusinessThe travel industry has its own “eco-system”. It generally consists of a chain of several international and / or local service providers. Several of these service providers earn on the same transaction – whether that is a booking for a vacation or a business trip, or the actual stay of an individual at a certain location. These service providers are often part of an existing network, whereby business owners, executives and employees know each other well. Many people have a lifetime career in the travel industry. This inevitable affects the style of debt collection and means that the debt collector has to understand the travel industry’s eco-system in order to be successful in collecting.

Understanding International Business Dynamics

The travel industry is almost by definition an international industry. A large part consists of people traveling to a location abroad, for vacation, for business or for other reasons. International debt collection differs in essential ways from local debt collection, as the claims are cross-border, covering multiple jurisdictions, business habits and sometimes languages. Options to legally enforce payment of international debts is substantially more complicated than looking to recover a local debt through legal proceedings. Therewith leverage changes and the focus shifts to amicable collections only. The debt collector must be aware of this and must be familiar with international debt collection in order to successfully collect in the travel industry.

Solution Minded Approach

Given the previous two points, debt collection in the travel industry means that the debt collection has to be solution minded. The interests of creditor should be taken into account, but also the relationship creditor-debtor, the fact that the focus should be on amicable collections and that leverage may be limited, but on the other hand, in case the commercial relationship is still there, that often the debtor depends on the creditor within the travel industry eco-system and that the debtor has a clear interest in solving issues. The debt collector often acts as negotiator or dealmaker, instead of “just” collector.

The travel industry is one of the largest international business sectors. The travel industry is all about providing services related to travel from one location to another. In order to provide debt collection services for the travel industry, the debt collector has to understand the travel industry, international business in general, and has to be solution minded.

If you want to know more about debt collection for the global travel industry,or for international business sectors, please reach out to Cobroamericas, on Linked-In or follow us on Twitter.

To participate in conversations about debt collection in Latin America please join the Linked-In Group Debt Collection Latin America.

Leave a comment

Account Receivables Management for International Business Sectors

29 November, 2020 admincobroamericas Account Receivables Management, International Business, International Debt Collection Account Receivables, Account Receivables Management, Company Incorporation, Hospitality, Import & Export, International Business, International Debt Collection, Legal Services, Logistics, Tourism

tourism account receivables managementAs international provider of B2B account receivables services, we are often contacted by companies for assistance in the similar business sectors.

Frequent International Business Sectors

The most frequent international business sectors can be categorized as follows:

  • Hospitality, tourism & travel
  • Entertainment & audiovisual industry
  • Logistics
  • Import & export
  • Digital marketing
  • Debt collection (from foreign debt collection agencies)
  • Legal services
  • Company incorporation & management

Account Receivables Management & More

The assistance companies from these sectors look for, include:

  • Outsourcing of account receivables management
  • Debt collection
  • Due diligence & best practices
  • Negotiations
  • Mediation

Common Characteristics of Business Sectors

What do companies from these international business sectors often have in common?

  • They do (exclusively) international business, and are subject to multiple jurisdictions, locations and time zones
  • Multilingualism: they do business in several languages
  • Companies do business with each other remotely and digitally: physical meetings are limited or inexistent
  • Business is done through a mutually dependent chain of several (smaller) independently operating companies
  • Transactions and invoicing are doing in multiple currencies.

Why External Account Receivables Management?

Benefits such companies obtain from a well equipped, knowledgeable and experienced international provider of ARM services are multiple and include: 

  • Knowledge of international business, availability in the desired timezone and presence in or near the location of the counter party
  • Skills in the desired languages, both the languages of the customer as well as of the business partner
  • Understanding of and experience with remote working and doing business digitally
  • Understanding of the specific business sectors mentioned above, and their unique infrastructure and economic and international ecosystem
  • Understanding the impact of multiple currencies and currency exchange policies and restriction, if and where applicable.

entertainment account receivables managementAccount receivables management for international business sectors is a niche and specialized job. It is important for companies from such sectors to receive tailor-made assistance, whereby the service provider’s unique in house expertise is complimentary and covers such areas the customer does not cover in-house.

In the next couple of post we will assess in more detail some of the international business sectors mentioned in this post.

If you want to know more about account receivables management for international business sectors, or international debtor collection in general ordebt collection in Latin America and the Caribbean in particular, please reach out to Cobroamericas, on Linked-In or follow us on Twitter.

To participate in conversations about debt collection in Latin America please join the Linked-In Group Debt Collection Latin America.

David Zannoni

1 Comment

International B2B Collections in Times of COVID-19

11 April, 2020 admincobroamericas International Debt Collection, Negotiation Account Receivables, Account Receivables Management, B2B Debt Collection, COVID19, Credit Management Latin America, Economic Crisis, Global Business, International Business, International Debt Collection, Negotiation

The COVID-19 pandemic has caused a worldwide economic crisis without precedents in recent history. The economic crisis has had a big impact on local and international businesses alike and for many companies it means liquidity problems.

In international business, creditors may face difficulties collecting outstanding invoices. Questions may rise as to how to approach international B2B collections in times of COVID-19.

Here are some thoughts as to how to approach international collections during the current economic crisis.

Liquidity may become an issue for debtor and creditor

liquidity B2b collectionsIf you feel awkward following up with companies abroad about outstanding invoices, please keep in mind that like debtors, also yourself as creditor may, at some point, be facing liquidity issues due to the current economic crisis. International trade and in connection therewith, cashflow between countries have deaccelerated or sometimes, have come to a full stand-still. The creditor continues to be in its right to claim payment of outstanding invoices, for work or services delivered. Actually, it is of utmost importance and sometimes even vital for the creditor to get invoices paid, in order to safeguard its own liquidity.

International B2B collections will continue

The way the creditor approaches international B2B collections, in terms of flexibility, as well as the possibilities of the debtor to pay, will no doubt be affected by the current economic crisis. However, it is a fact that collections will continue. That is, during the economic crisis and also once the crisis is over (which will eventually happen). Furthermore, payment issues may have existed prior to the COVID-19 outbreak, hence why the current economic crisis should not be a reason not stop international collections should not be taken as an excuse for debtors not to cooperate with payment.

Focus only on amicable B2B collections

Having pointed out the above, there will inevitably be changes in the way international collections are carried out. As already stated above, the current crisis means liquidity issues for both creditors and debtors. Also, in some countries, courts are closed for anything other than urgent cases. Taking into account that in any case enforcing payment of international claims through legal proceedings is a complicated matter – costly and time consuming – the focus for international B2B collections should for the moment be entirely on amicable collections. An amicable approach to settlement of international claims is more than ever necessary. The creditor should do more phone calls to find out what the debtor’s current situation is and send less or no letters at all. Try to limit email follow ups to the minimum.

Show empathy for your counterpart abroad

empathy b2b collectionsYour debtor’s situation may change rapidly, due to the spread of COVID-19 and subsequently, the effect on the economy and measures that local governments take. Showing empathy for your counterpart is therefore essential during today’s economic crisis. Call your debtor up and ask them how their business is going. Try to understand the circumstances they are in. Remember, your debtor was once – or still is and may be again in the future – your client! Try to level and understand the issues they deal with. Keep in mind that many businesses may have to temporarily close doors, and some may not be able to survive and go bankrupt. The COVID-19 outbreak and the economic crisis may have a big financial and mental effect on people.

Negotiate a tailor-made solution for the debt

With the aforementioned in mind, be prepared to think out of the box.This may include waiving parts of the debt,agreeing to long term paymentplans, accepting postponement of payment for a certain period of time, or a combination of these options. It is very important to be prepared to settle in international B2B collections. Focus on creating a win-win situation for both parties. If your counterpart feels that he may also win something during the current economic crisis, this may entail an opportunity to settle a long-time payment issue, or to recover a lost commercial relationship.

covid19 economic crisisThe COVID-19 outbreak and the global economic crisis caused by the outbreak, means that not only the debtor, but also the creditor, may face liquidity issues. However, international B2B collections will continue. During the current crisis, it is important to take an amicable approach to payment of outstanding debts, and to show empathy for your counterpart. With the foregoing in mind, the focus should be on negotiations for a tailor-made solution for outstanding debts during the COVID-19 crisis.

If you want to know more about international B2B collections during an economic crisis, please reach out to Cobroamericas, on Linked-In or follow us on Twitter.

To participate in conversations about debt collection in Latin America please join the Linked-In Group Debt Collection Latin America.

David Zannoni

19.433787
-99.152404
1 Comment

Latin America: how to prevent receivables from becoming uncollectible

17 August, 2018 admincobroamericas Debt Collection Latin America, Debt Collection South America, Due Diligence, International Debt Collection Account Receivables, Account Receivables Management, Debt Collection, Debt Collection Latin America, Due Diligence, International Debt Collection, Latin America, Latin America Business, Latin America Trade, Uncollectibles

Doing business in emerging markets requires a basic understanding of the countries your clients are based in.

Latin America is very diverse and offers business opportunities and challenges, which differ per country. Uruguay is different from Mexico, Chile is an open economy and Argentina and Brazil have foreign currency exchange restrictions, for example.

If you wish to avoid uncollectible receivables in Latin America, here are five topics you should focus your attention on.

Your “know your client policy” for Latin America

First of all, know the people and the companies you are doing business with. Where are your clients based? What is their business track record? Can you get referrals on them? What is their financial status and their commercial reputation, locally and internationally?

Legal context: contracts and other documents

Latin America contractsThe next step is to understand the legal context. How do contracts and other documents, like order forms, certificates and licenses work? Which are the requirements to make sure that these documents, which may be entered into between companies from different countries, have legal value in the country your client is based in? The assessment hereof may vary substantially per country in Latin America.

Invoicing requirements in Latin American countries

When you start to do business, and invoices need to be issued, it is of the utmost importance for you to understand the invoicing process as applicable in Latin American countries. There may be specific local requirements to make invoices legally valid. Also, your client in Latin America may, for tax reasons, may require specific formats for invoicing to be able to process and pay invoices.

Understand payment processes in Latin America

Latin America payment processFor an effective account receivables management in Latin America, you should understand local payment processes. Such payment processes may vary per country or region, and each company may have their own specifics. Generally speaking, payment processes may be subject to tax requirements, foreign currency exchange issues, short term or long-term economic circumstances, and administrative requirements imposed by law.

Correspondence and communication

How do you correspond and communicate with your clients in Latin America prior and during account receivables management? Which are the local habits? Do people generally communicate by phone, email or WhatsApp? Are there any recommendations from an administrative or legal point of view, to prevent receivables from becoming uncollectible in the future? Are original letters (still) required for formal notifications? What are the socially acceptable standards of professional communication in the countries of your clients?

Local support in Latin America

Will you be able to tap into local support in Latin America in case necessary? Any such necessity may be related to commercial representation, business consultation, due diligence, administrative follow up, account receivables management, debt collection or legal assistance.

Six topics I am brining up to prevent receivables from becoming uncollectible in Latin America are: your “know your client policy”, local legal context for contracts and other documents, the invoicing standards in Latin America, understanding local payment processes, standards for correspondence and communication with your clients, and establishment of local support in Latin America.

David Zannoni

If you are a foreign creditor and interested in learning more account receivables management for Latin America, please reach out to Cobroamericas, on Linked-In or follow us on Twitter.

To participate in conversations about debt collection in Latin America please join the Linked-In Group Debt Collection Latin America.

19.433787
-99.152404
1 Comment

Categories

  • Account Receivables Management (2)
  • Cambio de Divisas (2)
  • Cobranza Administracion Condominios (1)
  • Cobranza Caribe (3)
  • Cobranza Centroamerica (1)
  • Cobranza Chile (1)
  • Cobranza Economía Informal (1)
  • Cobranza Internacional (15)
  • Cobranza Latinoamerica (10)
  • Cobranza Mexico (2)
  • Cobranza Sudamerica (2)
  • Cobro Judicial Latinoamerica (1)
  • Credit Management Latin America (3)
  • Currencies Caribbean (1)
  • Debt Collection & Social Media (2)
  • Debt Collection Argentina (1)
  • Debt Collection Brazil (2)
  • Debt Collection Caribbean (6)
  • Debt Collection Central America (3)
  • Debt Collection Chile (1)
  • Debt Collection Costa Rica (1)
  • Debt Collection Financial Services (1)
  • Debt Collection Informal Economy (2)
  • Debt Collection Latin America (35)
  • Debt Collection Mexico (6)
  • Debt Collection Panama (1)
  • Debt Collection South America (6)
  • Debt Collection Trust & Fiduciary (3)
  • Debt Collection Venezuela (2)
  • Diligencias Debidas Latinoamerica (1)
  • Due Diligence (8)
  • Escrow Latin America (1)
  • Foreign Currency Controls (3)
  • International Business (2)
  • International Debt Collection (26)
  • Legal Proceedings Latin America (7)
  • Legal Proceedings Mexico (2)
  • Mediation (4)
  • Negotiation (10)
  • Property Management Collections (2)
  • Sin categoría (23)
  • Skip Tracing (4)

Archive

  • December 2020 (1)
  • November 2020 (2)
  • October 2020 (1)
  • August 2020 (1)
  • July 2020 (1)
  • June 2020 (6)
  • May 2020 (5)
  • April 2020 (2)
  • March 2020 (1)
  • February 2020 (1)
  • June 2019 (1)
  • March 2019 (1)
  • December 2018 (1)
  • November 2018 (1)
  • August 2018 (2)
  • June 2018 (1)
  • March 2018 (1)
  • February 2018 (1)
  • January 2018 (1)
  • October 2017 (1)
  • August 2017 (3)
  • July 2017 (2)
  • May 2017 (1)
  • April 2017 (1)
  • February 2017 (1)
  • January 2017 (4)
  • December 2016 (4)
  • November 2016 (4)
  • October 2016 (5)
  • September 2016 (2)
  • June 2016 (1)
  • April 2016 (2)
  • February 2016 (3)
  • January 2016 (3)
  • December 2015 (1)
  • November 2015 (3)
  • October 2015 (1)
  • September 2015 (2)
  • August 2015 (1)
  • July 2015 (2)
  • June 2015 (8)
  • March 2015 (1)
  • February 2015 (3)
  • December 2014 (3)
  • October 2014 (1)
  • September 2014 (2)
  • August 2014 (5)
Follow Debt Collection Latin America & the Caribbean on WordPress.com

Search

Blog at WordPress.com.
Cancel
Privacy & Cookies: This site uses cookies. By continuing to use this website, you agree to their use.
To find out more, including how to control cookies, see here: Cookie Policy