Spring, for many, indicates a time to clean.

In our personal lives it means organizing closets, throwing out unwanted items, and digging into corners deep cleaning areas that have gone all year without any attention. It means hard work, but it’s rewarding.

Don’t let the benefits of spring cleaning stop in your house. The affects can be beneficial to businesses too. And we aren’t just talking about dusting off desks. Review your processes and business plan. Update you budget. Evaluate your vendor contracts and pricing.

And if you don’t regularly examine your aging accounts receivables, start now.

Let’s consider past-due accounts averaging up to four months old. These are approximately 75 – 80% recoverable. For you it may be 90% or 70%.

Then consider past-due accounts 5 months and older. They have a much less chance of recovery, increasingly depreciating with time. The exact percentage really doesn’t matter. What does matter is the relationship between the two classes of accounts.

Obviously the older accounts are less recoverable than the newer accounts and because you don’t have enough time to work on them with full vigor, you have to concentrate on the earlier ones and give up on the older ones. If you were to continue to work on those older accounts, you may only recover about 20%. The same investment in time and money on the newer accounts produces roughly a 75% return.

Hanging on to your accounts, six to ten months, instead of four to six months is like playing the lotto. You might possibly win a huge jackpot. The odds are you will lose consistently. Seize the season of spring and dust off the files in your AR cabinet. Moving forward, make it a monthly habit.


Please visit Dynamic Legal Recovery’s website or call us at 858-348-1780 for your complimentary evaluation.