Issue link: https://read.dmtmag.com/i/330408
June 2014 | Construction Equipment Distribution | ZZZFHGPDJFRP| 49 Credit In order to shore up the onerous risks businesses have to undertake in order to say "yes" to sales in construc- tion, the law offers certain suppliers, contractors, subcontractors, laborers and others the right to secure their investment using liens, bonds and Uniform Commercial Code (UCC) filings. However, these tools are only available within certain tiers of the ladder of supply. If a company is too far away from the actual owner of the property where the work is happen- ing, they're not entitled to the same levels of security that other companies closer to the owner might be. States vary in their application of these laws and in their extension of these rights, but they all run out somewhere before the actual supply chain ends. A company that provides labor needs tools, and site prep contractors need equipment plus parts and service, and concrete suppliers need their materials and equipment and so on – but without any one of these parts in the process, the entire transaction collapses. So, risk is still inherently part of the construc- tion business for many companies, some of which sell their products and services without much in the way of legal recourse beyond a signed contract or credit application. This process is complicated even further by some chal- lenging facts about the nature of the companies operating in construction. One reason it's so important to have staff members who are well trained to manage risk is that financial informa- tion is often difficult to acquire. In a lot of cases, customers might not even know how to provide the type of financial information that a creditor might normally use to determine how or if to make a sale. There's often a knowledge gap among smaller customers in this regard, but the industry still requires goods and services on credit in order to successfully complete a project, and companies can't be too strict about demanding this type of information without possibly demanding their way out of potential sales. Managing Risk With Training In this way, risk is a necessary part of the construction business, and if it can't be beat, it has to be managed. There are a number of ways that businesses can increase their ability to properly accomplish this task. It may be through training, or more effective risk management tools and procedures, or anything in between, but the easiest way to increase this competency could be to recognize that many companies all share the same financial and credit risks, and that getting financial risk manag- ers to share strategies, information, Altus Endorsed for Cost Reduction Program by AED Associated Equipment Distributors recently endorsed the services of Altus, a national and international commercial credit management and debt collection firm, as part of its Cost Reduction Program offered to members. Under the endorsed program, AED members receive discounted rates on collection services and credit information. "We are committed to being a valued resource for AED members," said Tom Brenan, Altus president. "Because of our extensive experience in the industry, our specialized collectors have access to the latest information on all the players and can provide critical data on problem debtors across the market." Altus is part of the Coface Group of companies and serves as a world leader in trade risk management to over 100,000 customers throughout the United States and in over 90 countries. For over 60 years, Altus has helped companies manage and protect their account receivables. As a provider of commercial collection services, Altus has a proven track record, a commitment to customer service, and the ability to take advantage of the advances and changes happening in the collections industry. The combination of recovery expertise and Coface's global resources ensures Altus' ability to satisfy all the domestic and international collection needs of AED members. "Our aim is to work closely with AED members to help them reduce bad debt losses," said Monique Alexander, association development director for Altus. "Over 80 percent of our clients would recommend our services to another company. I believe this shows our strong commitment to client service and results." For more information contact Monique Alexander, association development director, Altus at (800) 318-6494 ext. 212, or e-mail at MoniqueAlexander@TrustAltus.com. FRQWLQXHGRQSDJH