Introduction to the Haulage Sector
In the complex and fast-moving world of haulage and distribution, cashflow is the lifeblood of operational efficiency and sustainability.
For one nationwide UK-based haulage and distribution firm, delayed and non-payment of invoices by clients became a critical problem, threatening the company’s ability to meet its obligations and invest in business growth.
This case study explores how Federal Management helped this company recover a substantial portion of its outstanding debts, reinforcing its financial foundation.
Client Background
The client is a leading UK haulage and distribution company with a nationwide operational footprint. Serving a diverse range of industries including retail, manufacturing, and construction, the company provides time-critical logistics services, palletised freight distribution, and long-haul transportation.
Despite its success and widespread reputation for reliability, the firm began to encounter growing challenges in recovering payment from a range of business customers.
The Problem: Mounting Unpaid Invoices
Over a 24-month period, the company accumulated over £380,000 in unpaid invoices. These debts were owed by more than 46 different business customers across the UK, spanning multiple sectors.
The outstanding payments were attributed to a variety of reasons, including:
- Deliberate non-payment or evasion
- Client insolvency
- Disputes over service levels or delivery times
- Administrative errors and payment processing delays
- Poor internal credit control by customers
The financial impact on the company was considerable. Delayed payments affected cash flow, restricted working capital, and began to put pressure on the company’s day-to-day operations, including payroll, vehicle maintenance, and fuel procurement.
Why Federal Management?
Faced with the urgent need to recover funds without damaging valuable client relationships, the company turned to Federal Management due to our:
- Proven track record of debt recovery in the B2B sector
- FCA authorisation and professional accreditation
- Transparent, ethical, and fully compliant recovery processes
- Nationwide coverage and haulage sector knowledge
- Cost-effective service with high success rates
The Strategy: Professional and Ethical Debt Recovery
Federal Management began with a comprehensive audit of all outstanding debts. This included assessing each account’s age, debtor type, reason for non-payment, and likelihood of recovery.
The team categorised the debts into three tiers based on complexity and potential outcome, enabling a targeted approach for each group.
Step 1: Initial Engagement and Trace Verification
Before initiating contact, Federal Management verified the current trading status and locations of all debtor companies.
This included tracing changes in company addresses, names, and directors where applicable. The tracing service was particularly useful for businesses that had ceased trading or changed legal entities.
Step 2: Multi-Channel Communication Campaign
Once verified, a tailored communication campaign was launched:
- Formal demand letters outlining the debt and consequences of non-payment
- Regular follow-up phone calls by trained debt recovery specialists
- Email correspondence with options for dispute resolution
- Offering of structured repayment plans where absolutely necessary
Federal Management used firm but fair language to encourage early settlement while preserving future trading relationships where viable.
Step 3: Legal Escalation and Enforcement
In cases where standard recovery efforts were unsuccessful, legal escalation was initiated with the client’s co-operation on three cases. This included:
- Issuing County Court Claims (CCJs) against persistent non-payers
- Obtaining Charging Orders against company assets
- Enforcement via High Court Enforcement Officers (HCEOs)
All actions were taken in strict accordance with UK debt collection regulations and were designed to maximise recovery while minimising disruption.
The Outcome: 82% Debt Recovery Success Rate
Over the course of six months, we successfully recovered £315,700 representing 82% of the total outstanding debts. This exceptional recovery rate significantly surpassed the client’s expectations and industry benchmarks.
Key Metrics:
- Total debt owed: £385,000
- Debt successfully recovered: £315,700
- Recovery rate: 82%
- Number of client accounts recovered: 36 out of 42
- Average time to resolution: 43 days
Benefits to the Client
The successful recovery campaign delivered numerous tangible and intangible benefits to the haulage company:
- Restored Cash Flow: Immediate improvement in liquidity and working capital.
- Preserved Business Relationships: Many accounts were settled amicably, allowing for ongoing partnerships.
- Reduced Internal Costs: Outsourcing debt recovery freed up internal resources to focus on core business activities.
- Improved Credit Control Awareness: Lessons from the experience prompted a review and tightening of internal credit control processes.
Federal Management’s Expertise in the Haulage Sector
The haulage industry has unique operational and contractual challenges that make debt recovery complex.
Federal Management’s deep understanding of sector-specific issues—such as proof of delivery disputes, warehousing terms, and subcontracting complications—allowed for tailored strategies that resonated with debtor companies.
Final Thoughts
This case study is a testament to the power of professional debt recovery services in resolving a mini cash flow crisis without jeopardising customer relationships.
The nationwide haulage company has since engaged Federal Management as their preferred partner for all future debt recovery needs.
With expertise across all industries and an unrivalled recovery rate, Federal Management continues to set the standard for ethical, effective, and efficient debt collection in the UK.
