XYZ corporation has two employees that cost a total of $90,000 annually. The two employees are given $26,000,000 in A/R. On 12/31/18 the two employees collected $3,110,000 and wrote of $22,890,000. Better collectors inc., an outsourced vendor states they can take the same $26,000,000 in A/R and collect 5,241,600 and only write of 20,758,400. The fee to Better collectors inc would be 13% of what they collected (5,241,600 * 13% = 681,408).
Should XYZ corporation terminate or repurpose the two employees and give the business to Better collectors inc.? What ROI would Better collectors inc state to XYZ corporation.
Please give detailed response.
Option 1 - if work given to employees
loss = salary paid + A/R not recovered
= $ 90,000 +$ 22,890,000
= $ 22,980,000
option 2 - Better Collectors inc.
Loss = Fees paid + A/R not recovered
= $681,408 + 20758400
=$ 21,439,808
Hence, the employees should be terminated and work should be given to Better Collectors Inc.
ROI to be stated by Better Collectors Inc.
investment = fees i.e. $ 681,408
Return = $ (5,241,600- 3,110,000) + $90,000
= $ 2,221,600
return on investment = $2,221,600 / $ 681,408
= 326 %
XYZ corporation has two employees that cost a total of $90,000 annually. The two employees are given $26,000,000 in A/R....
XYZ corporation has two employees that cost a total of $90,000 annually. The two employees are given $26,000,000 in A/R. On 12/31/18 the two employees collected $3,110,000 and wrote of $22,890,000. Better collectors inc., an outsourced vendor states they can take the same $26,000,000 in A/R and collect 5,241,600 and only write of 20,758,400. The fee to Better collectors inc would be 13% of what they collected (5,241,600 * 13% = 681,408). Should XYZ corporation terminate or repurpose the two...
XYZ corporation has two employees that cost a total of $90,000 annually. The two employees are given $26,000,000 in A/R. On 12/31/18 the two employees collected $3,110,000 and wrote of $22,890,000. Better collectors inc., an outsourced vendor states they can take the same $26,000,000 in A/R and collect 5,241,600 and only write of 20,758,400. The fee to Better collectors inc would be 13% of what they collected (5,241,600 * 13% = 681,408). Should XYZ corporation terminate or repurpose the two...
Playgrounds and Performance: Results Management at KaBOOM! (A) We do this work because we want to make a difference in the world; how can we go further faster? - Darell Hammond, CEO and co-founder, KaBOOM! Darell Hammond stepped onto the elementary school playground and took a long, slow look around. It was 8 a.m. on an unusually warm fall day in 2002 and the playground was deserted, but Hammond knew the children would start arriving soon to admire their new...
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