â€œI thought it would never happen to usâ€ lamented the Director of a well-known Newcastle electrical goods wholesaler. He was referring to the situation where a long standing client went into Administration and ultimately he only recovered a small portion of the $15k he was owed as an unsecured creditor.
Through the assistance of EC Credit Control the business has now implemented Terms of Trade documentation (Credit Application, Directors guarantees, Invoice, Quote, Job Completion, and Variation forms) tailored to their business, and is compliant with all Legislation requirements. In addition, EC Credit Control have registered the wholesalers â€œsecurity interestâ€ in their Top 20 clients on the Personal Property Securities Register (PPSR).
The PPSR was introduced in January 2012 and is the National register for all property other than land, buildings and fixtures. Key is that when a complete and correct registration is in place the party becomes a â€œsecuredâ€ creditor in a Liquidation event and any payments received will not be deemed a â€œpreferential paymentâ€.
The Director said â€œsure, I have had clients who had owed me money for a long time and I have had to employ a debt collectorâ€¦..but none have gone broke on me for this much previously!â€â€¦..â€I now feel comfortable that I have everything set up properly should it happen again in the futureâ€.