Corrosion Monitoring Systems, Inc.

Client since 2011

Corrosion Monitoring System’s operational solutions have helped hundreds of clients maximize the potential of their air heaters, improve their overall efficiency, and optimize their pollution control equipment. Based in Chicago’s western suburbs, CMS Inc. maintains a domestic and international clientele and relies on Coface and Trade Risk Partners to analyze risk on a monthly, case-by-case basis, maximizing its receivables while minimizing exposure.

Protective and proactive

“Our agent takes a very protective and proactive role with us—making sure we’re not only covered for our current receivables risk, but that we’re taking full advantage of the investment we’ve made in our Coface policy.”
–Alex Turner, CMS, Inc. president

How we partner

We work with our agent monthly to review our receivables on a case-by-case basis for coverage determination as well as risk management. Receivables on a particular project could be in the millions—but our coverage limit might be at $800,000. Therefore, it’s critical that we consider each receivable’s exposure when making decisions to increase coverage limits. “Our agent provides us excellent determination of the risk any particular project entails,” president Alex Turner says. “Using his expertise and access to robust information, he’s able to analyze payment likelihood, helping us determine when it’s in our best interest to increase coverage limits—as well as when, even if the receivable is high, payment risk is low, such as with government contracts.” Vigilance on a monthly basis enables CMS to stay current on receivables, making sure none escape management’s notice.

Why we partner

In 30 years, CMS has had one invoice on which the company declared bankruptcy. “One time is enough—you never want it to happen again,” Turner notes. “Although we haven’t had to exercise the policy, I wouldn’t want to be without it.” The policy also bolsters CMS when it comes to the company’s line of credit: “Our policy gives bonding agencies and financial institutions confidence in the strength of our receivables—that they’re more than their face value, because they’re backed by Coface.”

Trading safely within and outside the continental US

CMS relies on its agent’s expertise when considering expansion and revenue derived from sources outside the continental United States. Recently, while considering a large order from a new customer in Puerto Rico, Turner tapped his agent for advice to determine risk of exposure. “I wanted to know if I should increase coverage to insure the receivable before moving forward with this new client. Would the cost of increasing my coverage outweigh the potential risk of non-payment? These considerations are key in helping me safely expand my business—and as CMS expands internationally, partnership in these decisions continues to be critical for us to trade safely around the world.”

 

QTA

Client since 2014

QTA (Quality Tools & Abrasives) provides industrial supplies and solutions for a diverse industrial world. Headquartered in suburban Chicago with a location in Mexico, QTA offers supply-chain sourcing strategies that span the globe and a dynamic menu of capabilities that extend well beyond industrial-supply distribution, positioning it to help original equipment manufacturers maximize process efficiencies.

Mitigating domestic receivables risk

“We serve the domestic manufacturing market, and with a soft economy, there’s a lot more risk associated with covering midsized companies now. You have to mitigate that risk somehow—and partnering with the personal and adaptive support Coface and Trade Risk Partners provides is our solution.”
–Jeff Toleman, president

How we partner

With an active client base, QTA is constantly monitoring its current accounts receivable to determine risk. Monthly calls with its agent helps QTA’s leadership and accounting team assess risk and current coverage, as well as make any necessary adjustments. “Coface’s online portal is really valuable,” president Jeff Toleman notes. “We can log in and look at risk for current AR and customers, and ask to increase our coverage, if necessary. It’s on ourselves to do, but we have access to that information now. It’s very empowering that we can see it and control it—and that Trade Risk Partners and Coface are covering and monitoring in real time.”

Why we partner

QTA has had two claims, both of which were covered. Toleman knows trade credit insurance is essential for safer business. “We’d had our trade credit insurance policy previously with a competitor,” Toleman says, “and we switched to Trade Risk Partners and Coface because we found that the evolution of our business was changing and, therefore, the risk dynamics were changing, too. The support we found with a Coface policy was more personal and adaptive, at a much better cost.”

Safer domestic trading

“With our policy—and with the partnership of our agent—we can cover the majority of our domestic receivables as well as adjust coverage as necessity requires. Our coverage also helps us with our line of credit and banking. With our Coface policy in place, we can borrow on our receivables,” Toleman says. The partnership and protection QTA values in Trade Risk Partners and its policy means safer domestic trade—and better business opportunity.

 

KMS, Inc.

Client since 2015

KMS, Inc. is a wholesaler of factory overstocks and closeouts based in Wichita, KS. Over 90% of its sales and purchasing is domestic, though the company is starting to venture overseas—and looking to continue remarkable recent growth.

Good picture of customers’ financial security

“Since becoming a client, our overall comfort level with underwriting has increased. We know, based upon the due diligence of Coface’s underwriters, that we have a pretty good picture of our customers’ financial stability.”
–Steve Jess, CFO

How we partner

KMS, Inc. sought protection from loss and slow pays and access to overall underwriting and credit information—all to make better decisions on its customers, its receivables, and its business expansion. The company is growing quickly and its modestly sized staff wanted to tap global underwriting expertise. “Our agent has done a wonderful job serving as liaison between us and Coface,” Jess says. “He’s great at getting information back and forth to make the business of our policy as smooth as possible.”

Why we partner

“We hadn’t had a trade credit insurance policy in place prior to becoming a client,” Jess says, “though we understand how important the protection is. We were also looking for a more efficient underwriting procedure. We were referred to—and ultimately chose—Trade Risk Partners and Coface.” KMS, Inc. finds great value in the essential protection its policy now provides the growing company, notes Jess.

Better information, better decisions

The company’s policy arms KMS, Inc. staff with comprehensive and valuable underwriting information. “Because of the research Coface has already done, it has credit history information on 95% of the people I’m doing business with, “ Jess notes, “so I’m not reinventing the wheel every time I get a new customer. That’s really valuable to me.”