Negotiation with Sinosure is a lengthy process, but it can be done. The key to a successful negotiation is communication. Do not simply ignore its demands, hoping that Sinosure and it's debt collection agency will go away. If its demands are ignored, Sinosure will instruct Joseph & Brown, LLC to file a lawsuit, which will be more costly and stressful to defend. In addition, Sinosure may add your company's name to their blacklist of foreign buyers, which may impact your current or future credit terms with other Chinese suppliers.
This does not mean that you must abide by Sinosure's demands completely. There may be reasonable and/or legitimate circumstances to explain why payments are being disputed or were delayed. Below are some tips on negotiating with Sinosure:
Stay Calm
Dealing with a Sinosure debt collector can be stressful and emotional, however, it is best to stay calm and be respectful. The person on the other side may be helpful in communicating your position or proposal to Sinosure.
Avoid Over Communication
Avoid divulging any information over the phone or via written communication. Be mindful that anything you say or write down can be used in litigation. Do not confirm any outstanding debt.
Ask for Documentation of the Debt
By law, the debt collector must provide: (1) the debt amount, (2) the original creditor's name and address, and (3) the date of delinquency within 5 days of contacting you.
Make Sure The Trust Deed Exists
To collect on the trade export credit insurance, the Chinese supplier must assign its rights to the claim to Sinosure via a Trust Deed. Sinosure pays on the claim and will try to recover by assigning the Trust Deed to a debt collector. The Trust Deed gives the debt collector the authority to negotiate, settle, or litigate on behalf of Sinosure.
Make sure to ask for proof of the Trust Deed. Without this document, you maybe paying a debt collector that does not have the authority to negotiate or worst --- pay and still be liable for the debt.
Determine Your Negotiation Strategy
A successful negotiation strategy depends on understanding the circumstances around the payment dispute. Establish the common ground between the parties and identify what both sides agree on. Next, identify the issues that have lead to the dispute. There may be a multitude of reasons as to why a payment has not been made. Possible reasons could be:
The Buyer is claiming a dispute as to terms of the contract.
Were the products received?
Did the products conform to the specifications in the contract or purchase order?
Were the products received in a timely manner? Was there a material delay?
The Buyer may have fallen under economic hardship.
Are you capable of paying a reduced amount?
Can the payment be made in one lump sum or in payment plans?
The Supplier may have filed a false claim.
Sometimes a supplier may knowingly file a false claim to collect with Sinosure, knowing that there has been a material breach. It is important to keep a record of all communications with the supplier.
Sometimes, you may have already settled with the supplier directly. The supplier must notify Sinosure and withdraw it's claim.
Make an Offer & Stand Firm
Debt collection agencies are generally paid based on a percentage of the debt they recover. As a result, they will demand that you pay more than you are capable and/or willing to pay. Remain calm. Your response should stay professional, but firm.
