ARROWS helped the client resolve its payment difficulties with suppliers
ARROWS Law Firm provided legal counsel to a company that had fallen behind on payments to key suppliers due to a temporary drop in operating revenue. The goal was to prevent a halt in deliveries, the escalation of claims to judicial enforcement, and disruption of the client’s daily operations. Thanks to the chosen approach, the firm successfully negotiated payment plans and preserved business relationships with key suppliers.
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The client turned to ARROWS when it was unable to pay overdue invoices to several major suppliers on time and was facing the threat of having future deliveries—essential for continuing operations—restricted. ARROWS first conducted an analysis of the supplier contracts, the amount and due dates of the liabilities, contractual penalties, late payment interest, and the individual suppliers’ options to suspend performance or initiate collection proceedings. The strategy of managed out-of-court negotiations with a group of key suppliers was chosen as the most appropriate course of action, rather than passively waiting for lawsuits or enforcement actions. This approach was the best option in this case because the client’s business remained operationally viable and the problem stemmed primarily from short-term cash flow difficulties.
ARROWS subsequently drafted repayment agreements, managed communications with suppliers, and established payment terms that were acceptable to creditors while not hindering the client’s continued operations. The solution also included addressing debt acknowledgment, deferring payment deadlines, limiting penalties, and securing a commitment from suppliers to continue deliveries for the duration of the agreed-upon repayment plan. The result was the conclusion of agreements with key suppliers, the preservation of the supply chain, and the avoidance of legal enforcement and other actions that could have jeopardized the company’s operations.