Analyzing business bankruptcy statistics can provide insights on riskier locations to extend credit.
(PRWEB) November 14, 2016
The Kaplan Group, a commercial collection agency specializing in large claims, recently revealed a groundbreaking new method of analyzing state business bankruptcy statistics. Concerned about the number of clients who have trouble collecting debt from high-risk companies, The Kaplan Group wanted to provide clients with more accurate bankruptcy information.
“We always encourage clients to run credit reports before accepting major new accounts,” says Dean Kaplan, President of The Kaplan Group. “But it occurred to us that some clients should go further and do a more thorough assessment of the credit risk based not only on a company’s individual record, but also on the location of the business.”
Unfortunately, the most common method for analyzing regional business bankruptcy risk simply looks at the number of bankruptcies in a specific state. The issue with this method of analysis is that states with larger populations will always appear to have greater bankruptcy risk than states with smaller populations.
Kaplan’s new method adjust the analysis for each state’s population and its gross domestic product. In this way, one obtains a more accurate look at which states are the riskiest for creditors. For example, in the standard method, New York, California, Texas, Illinois, and Pennsylvania are typically the top five states for business bankruptcies due to their large populations and large number of businesses. However, with the adjusted method, all five of these large states fall farther down the list. Instead, during the second quarter of 2016, Delaware, Missouri, New Hampshire, Kansas and Arkansas become the five states with the worst business bankruptcy rates. The least risky states from a business bankruptcy standpoint during this period were South Carolina, Hawaii, South Dakota, Washington and Louisiana.
According to Kaplan, “The best way to solve collections problems is to avoid them by engaging in credit analysis and creating strong contracts. As a commercial collection agency it’s important to us that our clients have accurate and useful bankruptcy information available. We believe this new method gives a more complete picture of risk.”
The full study on business bankruptcy risk is available on The Kaplan Group website.
About The Kaplan Group:
The Kaplan Group, Inc. is a commercial collection agency founded in 1991. Known in the industry as “The Large Claim Experts”, the company provides B2B debt collection services on a contingency basis throughout the USA for domestic and international clients. Dean Kaplan has completed over $500 million in transactions during his career and personally handles all large claims. For more information, please visit http://www.kaplancollectionagency.com, email info(at)kaplancollectionagency(dot)com or call 805-541-2639.