Knowledge Centre - Case Study

An economical way to collect payments

The Unipart Group is a leading full service logistics provider that also delivers consultancy services in operational excellence and supply chain. Unipart Merchandise, a subsidiary of the group, provides merchandise such as caps, key chains and clothing for customers such as Jaguar and Landover. The company recognised that Direct Debit was the most efficient way to collect payment from its customers. Susan Cummings, Financial Controller at Unipart, says: "We want to get as many of our customers to pay by Direct Debit as we can - simply because it’s more economical to collect by Direct Debit. At the moment, more than 70% of our UK clients pay by Direct Debit." When Unipart set up the Merchandise division, it needed to find software to help collect payments using the Automated Direct Debit Instruction Service (AUDDIS).

Keen to comply

As a new legal entity, Unipart Merchandise was particularly concerned about complying with the Direct Debit scheme rules. When Lloyds Bank helped Unipart with a bulk migration of Direct Debits, it recommended that the company speak to global payments specialists Direct Debit Limited about software that could automate Direct Debit processes and ensure compliance. Cummings looked at Direct Debit Limited's payments platform, PayCentre®, and compared it with software from another supplier. Cummings says: "Unlike existing Unipart companies, we needed to be AUDDIS compliant from day one because we were a new legal entity. I evaluated both sets of software and felt that PayCentre® was more appropriate for our organization because it manages Direct Debit workflows, which is what you need when you're new to Direct Debit."

Ensures Unipart complies with Direct Debit scheme rules

By implementing PayCentre®, Unipart complies with the Direct Debit scheme rules and avoids the administrative burden that comes from managing these processes manually. For example, PayCentre® automatically generates correspondence for Unipart's Direct Debit customers in the timeframes specified in the scheme rules. Cummings says: "When we found out about the regulations involved with processing Direct Debits, we were even happier that we'd chosen PayCentre® because it ensures we comply with the scheme rules."

Reduces time spent processing payments

Unipart has reduced the time it spends on a typical collection run to just an hour thanks to PayCentre®. The platform deals with reports from Bacs automatically. As a result, it's easier to deal with changes such as amended bank account details. PayCentre® also checks account details as employees enter them, which significantly reduces data entry errors and, consequently, the number of unpaid items. "It's just incredible that I can do an entire collection run in the space of an hour. It would be very time consuming to produce the letters manually and to insert ad hoc amounts," says Cummings.

Saves £50,000 a year in administrative costs and improves cash flow

The combination of Direct Debit and PayCentre® makes it easier for Unipart Merchandise to collect payments. Additionally, it gives the company more control over its cash flow. "It saves a huge amount of time in chasing customers for payments," says Cummings. "For me, the biggest benefit of Direct Debit and PayCentre® is that it improves our cash flow." Cummings estimates that Unipart Merchandise saves around £50,000 in costs because of Direct Debit and PayCentre®.