case study - the kaplan group...case study sales, marketing & advertising • 805-541-2639. ......

Case Study Sales, Marketing & Advertising

WWW.KAPLANCOLLECTIONAGENCY.COM • 805-541-2639

Question to Ask Yourself

If your client needed specialized digital content, would you send them to an agency that only did print campaigns but wanted to “give digital a try”? Of course not.

The same is true of collections, you want someone who not only specializes in the type of claim you have, but also in your industry. At The Kaplan Group we have decades of experience working with sales, marketing, and advertising companies. We know that your concerns and challenges are different from other organizations. Some issues that are common in cases involving sales, marketing, and advertising include:

In addition to his years as a leader in the collections industry, Dean Kaplan has 35 years of international business and negotiation experience. He has served as a consultant, CFO, and COO for companies in various industries and at various stages of development, all of which make him well qualified to handle the unique collections issues facing sales, marketing, and advertising firms. At The Kaplan Group we understand the perspective, politics, and personalities of everyone involved in a business deal, whether it’s a large or small company or somewhere in between. The following case studies showcase a few of the sales, marketing, and advertising related claims we’ve handled. Contact us to find out how we can help with your situation.

Complicated contracts and payment

structures

International and inter-state claims, both of which require

legal expertise and experience

Disagreements over acceptable performance

and quality of work

Our Secret Sauce

Our Secret Sauce The Kaplan Group is known in the industry as The Large Claim Experts. Our 85% success rate on large viable claims is unprecedented.

94% 81% 85% 93% Claims over

$10,000

2015 2014 20132016

Dean Kaplan personally handles all large claims:

§  35 years of international business and negotiation experience

§  MBA University of Chicago

§  Traveled to over 40 countries to negotiate transactions and business deals

§  Negotiated over $500 million of mergers and acquisitions

§  CFO and COO of several early stage technology companies

§  Consulted for over 200 companies (business plans, strategy, operations, negotiations)

§  Owner/operator of small manufacturing company for 8 years

We understand both the services our clients provide, and the points of view of their customers. We are financial and negotiation experts. We offer competitive contingency rates from 10% to 25% depending on the size of the claim. We have an A+ rating with the Better Business Bureau and dozens of 5 star online reviews from clients.

$250,000 Recovered for Client #3144

0

10

20

30

40

50

60

32 VIABLE CLAIMS

32 Claims Not

Viable

81% Accounts Resolved

Total Accounts Accounts Resolved

PAID 26

$-

$100,000.00

$200,000.00

$300,000.00

$400,000.00

$500,000.00

$600,000.00

TOTAL CLAIMS $509K

58% Loss Revenue Collected

$753,000

58%

*Data based on The Kaplan Group client #3144 Internal Recovery Reports

Dollars Placed Dollars Resolved

Accounts Resolved Of the 53 claims worth $900,000 placed over 5 years, 17 were defunct and 4 had poorly worded auto-renewal clauses preventing success. We collected on 26 of the 32 viable claims, many of which were auto-renewals, some of which required litigation to enforce when settlement offers were unacceptable.

Revenue Recovered We collected $268,998 out of $509,044 (52%) on the 32 viable claims. Payment in full was recovered from 11 customers and 15 accounts were settled. Many settlements were for auto-renewals using revised language we provided where customers never utilized services during the extended period.

$250,000 Recovered For Sales Intelligence Vendor Client 3144 provides a “sales intelligence” platform including contact information for target customers. §  92% success rate on large viable claims (81% success on all sizes of viable claims) §  Our nationwide network of contingency attorneys was utilized for 22% of successful claims §  Changes we recommended to client’s auto-renewal clause resulted in increased recoveries

8 out of 10 Accounts Resolved for Client #4474

0

2

4

6

8

10

12

14

10 VIABLE CLAIMS

3 Claims Not Viable



PAID 8

$48,000

$50,000

$52,000

$54,000

$56,000

$58,000

$60,000

$62,000

$64,000

TOTAL CLAIMS $63K


$53,000 85%



Accounts Resolved The Kaplan Group resolved 80% (8 out of 10) viable claims. The 2 unsuccessful claims were too small to justify litigation (average size under $4,000) and highly disputed. Another 3 claims were not viable as the businesses were closed.

Revenue Recovered We collected 85% ($53,212) of the $62,949 in viable claims. Four customers paid in full plus interest which helped offset client’s collection costs. Two others paid in full and two disputed accounts settled (discount was under $1,000 in each case).

Digital Advertisements

Client 4474 develops and places digital advertisements. §  80% success rate on viable claims §  Overcame numerous click fraud accusations based on our knowledge of this issue

International Accounts Solved for Client #4723

0

2

4

6

8

10

12

14

37 VIABLE CLAIMS

19 Claims Not Viable



PAID 25

$0

$100,000

$200,000

$300,000

$400,000

$500,000

$600,000

TOTAL CLAIMS $558K


$229,000

65%



Accounts Resolved The Kaplan Group collected on 25 of the 37 viable claims placed in 2015-2016. Of the 11 unsuccessful claims, 4 were overseas customers where litigation was not viable, one was highly disputed, and 6 were too small for suit (average size under $3,000). Many claims were for auto-renewals.

Revenue Recovered We recovered $293,197 (68%) of the $353,853 in viable claims. Twelve paid in full (3 paid interest) and 14 were settled with an average recovery of 51%. We had a 100% success rate on large viable claims and a 70% success rate on all viable claims (including international customers).

Social Media Marketing Services With International Clients Client 4723 is an international SAAS provider of social media marketing management services. §  70% success rate (approximately 1/3 of claims were for foreign based customers) §  Our network of international collection agencies achieved success in Mexico, Peru, Singapore,

United Kingdom, Kenya and the British Foreign Islands for this client.

VIABLE CLAIMS $353K

All Accounts Resolved for Client #4475

0

2

4

6

8

10

12

14

16

7 VIABLE CLAIMS

7 Claims Not Viable



PAID 7

$0

$20,000

$40,000

$60,000

$80,000

$100,000

$120,000

TOTAL CLAIMS $96K


$48,000 50%



Accounts Resolved Client 4475 provides data analytics and market intelligence in Europe. A law firm based in the UK was unsuccessful at collecting and assigned us 14 U.S. based claims. Seven of the claims were uncollectible due to non-enforceable documentation and out-of-business companies. We collected on the remaining 7 claims.

Revenue Recovered Three customers paid in full (one also paying interest) and 4 claims were settled, recovering $48,000. Client 4475 indicated they would never sue and requested a less aggressive approach to maximize getting something instead of nothing on each viable claim.

European Based Marketing Services Firm Collecting on international transactions is one of our specialties but can present challenges. §  Customers often believe foreign companies won’t sue and therefore won’t pay §  Because we have an in-house law firm, we convince debtors litigation is a real possibility §  Clients get the same competitive agency contingency rates from our in-house law firm §  We have a nationwide network of contingency attorneys when litigation is required

9 Out of 11 Claims Collected for Client #4555

0

2

4

6

8

10

12

14

11 VIABLE CLAIMS

1 Claims Not Viable



PAID 9

$0

$10,000

$20,000

$30,000

$40,000

$50,000

$60,000

TOTAL CLAIMS $57K


$24,000 42%



Accounts Resolved The Kaplan Group collected on 9 of 11 viable claims, an 82% success rate. The 2 unsuccessful claims were for under $1,500 each. One non-viable claim was also submitted - the company was out of business before the collection process started.

Revenue Recovered We recovered $23,789 out of $56,549 of unpaid invoices from viable claims (42%). Three claims were paid in full and six were settled as the customer did not use our client’s services during the periods covered by unpaid invoices.

Success With Smaller Claims

While known in our industry for our large claims expertise, Client 4555 provides email marketing services for a low monthly fee. The majority of their claims were smaller than we normally handle. §  Most claims were for auto-renewal or termination disputes

§  82% success rate on 11 viable claims

Our Collection Process: We tailored our collection process to the specifics of this situation. The first priority was to get the partners to engage in phone conversations, something they resisted for nearly one month. We overcame their hesitations by insisting that we we needed to understand all of their claims and concerns, we would only listen, not argue. We spent hours listening to their complaints, reviewing contracts, work product, and email communications. We refuted each allegation with detailed information from our clients. It took almost three months to convince the start-up that they would need to pay at least something. Ultimately, it was Dean Kaplan’s direct experience as an executive for early stage companies that enabled him to convince the partners to use their personal money to settle rather than fight litigation. It took another 45 days to negotiate the final settlement amount and terms. They wound up settling for 50% of the outstanding balance, five times higher than their initial offer. Upon completion, our client’s CFO said:

5 Times Initial Offer Achieved for Client #4791

$238,000 Dispute Resolved On Marketing Strategy Engagement

Client 4791 provides branding and marketing strategy and implementation. They were hired by a start-up to develop, produce, and implement a marketing and social media strategy and design and produce all initial marketing collateral (website, logo, signage, etc). The customer paid over $300,000, but with delays in getting to market and revenue coming in below projections, their cash became tight. Our client continued to provide services based on the customer’s commitment to pay. When the past due balance got above $200,000, the customer began blaming our client for the revenue shortfall. They indicated that they would not pay ANY of the outstanding amount.

Thanks for all your help with this one. Good work, and greatly appreciated.”

There were several factors complicating the process: •  The start-up was founded by four partners with no previous experience running a business; •  The start-up was thinly capitalized with minimal revenue and no cash reserves; •  One of the start-ups founders was a practicing attorney; •  The start-up threatened a counterclaim for the return of money already paid.

100% Success Rate for Client #4447

Client 4447’s Quarter Million Dollar Problem

Nearly three years after we began working with client #4447 they had a $268,000 problem. Their customer had already paid over $500,000 for services, but suddenly stopped paying. Once the invoice was 30 days past due, our client stopped providing services. With monthly fees exceeding $100,000, the balance owed exceeded a quarter million dollars. The customer’s initial position was that they were not going to pay any of the $268,000. They claimed there was a performance guarantee in the contract. We spent two months working through the customer’s various disputes and providing substantial documentation justifying all of the invoices. Although the customer identified language in the contract to dispute $69,000 of the outstanding fees, an even bigger concern came to light. The customer claimed to be in terrible financial shape. After we signed an NDA, the customer was willing to share their financial statements with us. These statements confirmed negative equity in excess of $100 million and significant bankruptcy risk. This was clearly the real reason for their nonpayment. Our client eventually received a settlement of $99,000, which was 50% of the undisputed $198,000.

Thanks for your hard work on getting this deal negotiated and complete.” CFO

Great work everyone” CEO

0

2

4

6

8

10

100% Success Rate for Client #4447

9 VIABLE CLAIMS



PAID 9

$0 $20,000 $40,000 $60,000 $80,000

$100,000 $120,000 $140,000 $160,000 $180,000 $200,000

TOTAL CLAIMS $184K


$90,213

49%



Accounts Resolved Of the 10 claims placed (not including the $268,000 claim discussed on the next page), one was out of business and we recovered on 100% of the 9 remaining claims.

Revenue Recovered Three claims were paid in full (one also paid interest) and six claims were settled. We recovered $90,213 (49%) out of $183,720 placed (excluding the $268,000 claim). No litigation was required.

Advertising Management Services

Client 4447 specializes in Pay Per Click campaign management. §  100% success rate on 9 viable claims over 3 years §  Many were vigorously disputed when customers’ desired revenue increase not achieved §  One $268,000 claim (see next page) resolved despite severe issues

1 Claim Not Viable

NEED AN EXPERT WHO WON’T QUIT UNTIL YOU ARE PAID?

CALL 805-541-2639

WWW.KAPLANCOLLECTIONAGENCY.COM • 2250 KING COURT, SUITE 50, SAN LUIS OBISPO, CA 93401 • 805-541-2639

VISIT WWW.KAPLANCOLLECTIONAGENCY.COM

case study - the kaplan group...case study sales, marketing & advertising • 805-541-2639. ......

Documents