The Connection
June/July 2020
Say " Hello" to NACM's Newest Members
Acme Brick, Tile & Stone (Multiple member)
Ascent Global Logistics (2 Multiple members)
Crossroads Roofing Supply Inc.
Empire Supply (Multiple member)
England Logistics, Inc.
Fox Scientific
H & E Equipment Services Inc.
Impac Fleet
Level3 Corporation
SW Electric *HQ
Synerlock Corporation
Velocity Financial, LLC

Please keep checking our NACM Southwest website for all COVID-19 Resources and Updates for our members.

NACM Southwest Memorial Scholarship
NACM Southwest Memorial Scholarship recipients have been named!
Carson Draper is the son of proud NACM Southwest employee, Mandy Draper. He is a 2020 graduate of Grapevine High School. Carson is a 4-year member of the Varsity Tennis team, serving as Team Captain for two years. The team proudly boasts several district, regional, and state titles. Carson will begin his college career at the Tarrant County College with plans to transfer to the University of Texas at Arlington to pursue his passion for photography.
Brooke Gautreaux is the daughter of Maggie Gautreaux, member of NACM Southwest with the Jewell/Ash Grove Company. Brooke is graduating in 2020 from Legacy High School in Mansfield, TX where she was a member of the cheerleading team and student council. She plans to continue her education at Dallas Baptist University and pursue a career in Elementary Education.
The More You Know

  • Application Due: September 4, 2020
  • Exam Date: November 9, 2020
Upcoming Dates for 2021

  • Application Due: January 15, 2021
  • Exam Date: March 8, 2021

  • Application Due: March 19, 2021
  • Exam Date: May 16, 2021 (Credit Congress Kansas City, MO)

  • Application Due: May 28, 2021
  • Exam Date: July 26, 2021

  • Application Due: September 10, 2021
  • Exam Date: November 8, 2021


Webinar: Randal K. Lindley - Advanced Bonds and Liens-PART 2
Date: June 9, 2020
Time: 9am

Webinar: Dun & Bradstreet - "Is Your Bad Debt Reserve Optimized"
Date: June 16, 2020
Time: 1:00pm

Dallas - Business Credit Principles - Upcoming Course August 2020
         Dates: August 2-6, 2020
        Cost is $849 - includes Tuition, Textbook, Breakfast and Lunch Daily
15% OFF
Be sure to enter code
[SALE] at checkout to save!
         Use this coupon for ANY NACM Southwest seminar!

*Coupon can only be used once per person and cannot be combined with any other offer. Not redeemable for cash.
Please email this coupon and your seminar registration form to

Offer Expires 7/31/2020
News Notes
It breaks our NACM Southwest heart to share that longtime, recently-retired NACM team member Kathy Wilson has passed away.
It was way back in 1980 when Kathy joined our team. She had an uncanny ability to remember member details and it was not unusual to answer any questions with “Ask Kathy!. She was quick with a smile, made the very best macaroni & cheese for our company potlucks, and could always figure out how to fix the dang copier! She loved the Cowboys, the Mavericks, and the Rangers – always a loyal fan. No one loved bowling like our Kathy! It was not uncommon for her to be bowling in a couple of leagues at the same time. For years and years and years, even after she retired, she was our company lotto pool coordinator. We never won the big money jackpot…but we got Kathy, loved her as a co-worker and even more as a friend, so perhaps we were all winners after all.
Our condolences to her sons, Brandon and Chris, and to her sweet granddaughter Christa who always made Kathy smith with pride and love.

How to Identify a Potential Bankruptcy
As Congress continues to find ways to assist businesses and individuals, stimulus and Payment Protection Program money has been spent, leaving those businesses and individuals no better off as COVID-19 continues to wreak havoc. Common sense and logic point toward major issues arising in the coming weeks and months as the potential for unpaid bills piles up. When invoices go unpaid, it starts a downstream trend no business or person wants to see. Many businesses have already been impacted, e.g., Neiman Marcus, J. Crew, Intelsat. Many more businesses are also on the verge of bankruptcy and will most likely file soon.

In the April Credit Managers’ Index from NACM, fillings for bankruptcies worsened but remained in expansion territory. “This is a situation that will worsen in time as more companies find themselves in trouble,” said NACM Economist Chris Kuehl Ph.D. Total bankruptcy filings declined 46% in April compared to April 2019, according to the American Bankruptcy Institute. However, total commercial Chapter 11 filings increased 26% year over year. It’s only a matter of time before the unpaid invoices are too much to handle leaving creditors holding the bag.

“The economy we’re experiencing and will be experiencing in the coming year will be very difficult,” said John Salek, president, Revenue Management Associates LLC, in NACM’s recent webinar “Predicting Customer Bankruptcies Fast and Accurately in the Coming Depression.” He added, “There will be more bankruptcies among your customer base than in the past. The biggest challenge will be achieving a breakeven sales value while controlling who you sell to.”

Most companies sell to a range of customers, and credit departments have standards that will have to change with the times. It’s important to work with customers to accommodate them. It’s also vital to update risk assessments on all customers. Credit information, even from early March, is too old and not relevant anymore.
There are a number of ways to identify a potential bankruptcy, and from different avenues. Key factors can be identified by the sales, service and collections teams, and from credit investigations. Salek developed a top 10 list to help identify potential bankruptcy candidates.

The Top 10 List
Adverse news events
Bounced NSF payments
Bond default, forbearance and/or price deterioration
Financial deterioration documented through financials
Delinquent payments
Extended payment term/higher credit limit requests
Broken promises
Significant increase in invoice disputes
No contact
Failure to supply financials.

The top benefit of improved bankruptcy prediction is the survival of your company, noted Salek. It’s important to maximize the cash flow from orders filled with existing inventory, retained services and staff while optimizing the cash inflow from orders filled with newly purchased inventory.

Most companies will have lower revenue and lower cash inflow during this time. “It is imperative that customers pay at least most of what is owed in the short to medium term,” Salek said. Identifying high-risk customers and forecasting cash flow scenarios is also important.

The second of Salek’s two truths, the first being that there will be an increase in bankruptcies, is that credit professionals will have to sell on credit to uncreditworthy customers to make their breakeven sales volume. “This goes against everything we have been taught and practiced,” Salek said. There’s a big question that credit departments must ask themselves. Why are they receiving requests from new customers? One potential reason is their current supplier cut them off for nonpayment, so it’s important to watch the department’s exposure to make sure payments are made on a timely basis.

-Michael Miller, managing editor
NACM Southwest Scholarship Fund
The NACM Southwest Education Fund is designed for ALL NACM Southwest members who contribute to the fund. It provides a great opportunity to help keep the costs affordable for the educational seminars and events that your association offers.
With your contribution, you and your company, as well as your fellow credit professionals, help provide the opportunity for low cost educational events that help elevate the level of the credit profession and professional.
The next time you receive your invoice, please consider the voluntary education fund contribution. The beneficiary of the fund may be you and your company!
Any questions regarding the Education Program please contact Tony Clark NACM Southwest 972/518-0019.

Payments During COVID-19
We live in strange times. A viral pandemic has swept the globe. The Pentagon has released video of UFOs. The world’s largest hornet species has invaded the U.S. What sounds like a poorly written Stephen King novel has become reality. Yet despite the chaos, many credit professionals are successfully keeping themselves grounded by maintaining some state of normalcy in their daily operations. The most consistent routine among most credit professionals is their payment process, beginning with credit approval through payment collection.

According to NACM’s April Coronavirus survey, nearly 25% of respondents said none of their customers requested extended terms, while nearly 75% said none of their customers requested credit line increases. Furthermore, in NACM’s March survey, fewer credit professionals said they approved customer requests for credit line extensions during COVID-19 than before the outbreak. For several credit professionals, the payment process is business as usual.

At Corey Construction in Houston, Texas, Credit and Collections Analyst Kate Hooper said her department begins with net 30-day terms for all new customers, unless upper management requests terms be shortened or extended. With most customers set at net 30 days, the department can easily stay within the state’s lien rights guidelines. Late payments for any non-new production invoices are addressed by a sales person/project manager, who will contact the customer via phone, text or email to request reason for late payment.

“We perform weekly aging reports on all past dues and send out demand letters/intent letters and liens accordingly,” Hooper said. “However, we do not send demands/intents/liens to our new production customers, but we do send weekly past due emails with their invoices attached.”

Once they lien a customer, the department places that customer on hold for any new work in the system as to not create a bigger aging issue. Hooper said they also hand over any liened customers to their legal counsel to pursue via demand letter from their law firm, civil suit or what they may feel is necessary for Corey Construction to get payment.

Hooper said the company hasn’t slowed down since COVID-19, but has made special exceptions for customers to pay via credit cards and waive the 3% fee.

“I believe it is very important for our credit department to maintain some normalcy, especially because there is no extension of the Texas lien rights amid this epidemic,” she said. “In order to uphold our rights, we still must send out demand letters, intent letters and liens to the county clerk’s office in the timeframe allotted to stay within the rights of the law. It is also important that we stay on top of our aging reports to remind our customers payment is still due and to contact us for special circumstances.”

Operations must continue at Company Wrench, Ltd. as well, said Finance and Credit Manager Kris Stephenson, CBA, CCRA. Despite a slowdown in applications to establish new open accounts, he said, there has been an increase in applications for the purchase of capital assets. Company Wrench sets terms similarly to Corey Construction, typically at net 30 days; however, terms may be extended to net 45 or 60 days depending on the customer’s trade credit history.

To stay on top of late payments, Stephenson said calls are made starting at 60 days to confirm receipt of the invoices, ferret out problems and push for payment. The pandemic has presented challenges to the credit department, but business is manageable.

“We have maintained our credit staff and added two individuals to help assist with follow-up and soft collections,” Stephenson said. “Besides those items, we have maintained a ‘business-as-usual’ attitude as we operate a necessary business and serve infrastructure, utilities and transportation segments. If we do not maintain a sense of normalcy, then our business model and bottom line will suffer.”

—Andrew Michaels, editorial associate
All South Credit Conference
September 20-22, 2020

Conference Registration will open in June 2020.