Restructure
60%
lower daily payment
Vendor & Trade Debt Resolution
Restructure vendor debt — without burning the relationships
Trade payables, vendor financing, and supplier debt workouts. We negotiate AP restructures that preserve the relationships you need to keep operating — while resolving the balance.
AP
accounts payable
VENDOR
financing programs
TRADE
30/60/90 terms
KEEP
relationships intact
THE PROBLEM
Vendor relationships are operating capital
AP RESTRUCTURE
$240K AP
Restructured · all vendors retained
Most distressed-debt firms don't understand this.
Vendor debt is unlike any other debt class because the creditor is also part of your operation. The supplier you owe is the supplier you need to ship next month's product. Burning that relationship to "win" the negotiation usually loses the business.
Most distressed-debt firms don't understand this. They send the same demand letters they'd send a bank or an MCA, and the vendor cuts you off. The negotiation succeeds; the operation fails.
We negotiate vendor debt the way you'd negotiate it yourself if you had the time — with the operational future of the relationship as a primary constraint.
WHAT WE HANDLE
6 scenarios, opened up
01
Negotiate term-out of overdue payables into structured paydowns over 6–24 months.
How we run it
- 01Inventory full AP aging + vendor terms
- 02Build per-vendor restructure ask
- 03Negotiate term-out terms
- 04Execute paydown plans
Typical outcome
Avg outcome: AP termed-out over 12–24 months, vendors retained
02
Settle the existing balance at a discount and re-establish standard credit terms going forward.
How we run it
- 01Identify vendors open to settlement
- 02Negotiate lump-sum discounts
- 03Document settlement and resumed terms
- 04Restore credit lines going forward
Typical outcome
Avg outcome: 30–60% discount; resumed standard terms
03
Identify and preserve full-payment status with mission-critical suppliers while restructuring others.
How we run it
- 01Identify mission-critical vendors
- 02Confirm full payment for those vendors
- 03Restructure non-critical AP separately
- 04Document segmentation
Typical outcome
Avg outcome: zero supply-chain disruption
04
Workouts on dealer floor plans, supply-chain financing, and vendor-extended credit facilities.
How we run it
- 01Audit vendor financing program terms
- 02Identify modification or buyout angles
- 03Negotiate amended terms
- 04Document resolution
Typical outcome
Avg outcome: program retained on amended terms
05
When AP exceeds operating capacity across many vendors, run a coordinated multi-vendor restructure.
How we run it
- 01Map full AP across all vendors
- 02Sequence negotiations strategically
- 03Run parallel negotiations
- 04Close coordinated restructure
Typical outcome
Avg outcome: coordinated AP resolution in 4–8 months
06
Defend against vendor-initiated lawsuits and mechanic's lien filings while negotiating.
How we run it
- 01Receive complaint + lien filing
- 02Build defense + counter-offer
- 03Negotiate settlement and lien release
- 04Document resolution
Typical outcome
Avg outcome: filed cases settled at 30–55% of demand
“
FROM THE DESK
The vendor you owe is the vendor you need to ship next month's product. Most distressed-debt firms don't understand that — they win the negotiation and lose the supply chain. We don't.
Our process
From
same-day
intake
to
closeout
Most cases hit resolution between months 3 and 6. We move on day one because deadlines don't wait.
01
Pull complete vendor list with balances, aging, contract terms, and operational dependency. Tag mission-critical suppliers (production, distribution, software) separately from elective vendors.
AP aging report · Contract review · Critical-path tagging
02
Determine the monthly availability for vendor workout based on real cash flow. Allocate pro-rata across the stack so every vendor sees a credible offer that fits the math, not wishful thinking.
Cash-flow model · Pro-rata math · Reserve buffer
03
Written hardship letter plus structured offer to every vendor. Critical vendors get full payment to preserve supply; non-critical balances get termed-out or settled at a discount. We field every reply in writing.
Hardship letter · Term sheets · Counter-offers
04
Memorialize each settlement or restructure in a signed agreement. Resume normal AP operations on amended terms. Track performance for 6 months to lock in restored trade credit going forward.
Settlement agreements · Lien releases · Trade credit restoration
“We owed nine vendors over $400K and three of them were threatening lawsuits. Delancey Street ran one coordinated process — every vendor got a written plan, eight signed, and we kept production going the entire time. Without that we'd have shut down.”
WHERE WE WORK
Vendor Debt Resolution cases in all 50 states
FAQ
Common questions
Won't my vendor cut me off?
If the negotiation is run badly, yes. Done correctly, vendors prefer a known borrower on a structured paydown to a write-off and customer loss. We approach the conversation as restructuring, not adversarial collection — and the relationship usually survives.
What about smaller vendors I want to pay in full?
Common and important. We segment the AP: critical vendors get full payment to preserve operations; non-critical larger balances get restructured. The strategy is per-vendor, not blanket.
A vendor already sued. Can you still help?
Yes. Vendor lawsuits are usually settled — vendors don't want a litigation expense and a bad customer outcome. We routinely settle filed cases at significant discounts.
My biggest supplier holds a UCC lien on inventory. Now what?
A vendor UCC lien changes leverage but doesn't end negotiation. We've worked many AP cases with secured vendor positions — modifications, partial paydowns with collateral release, and term restructures are all on the table.
Can you handle multi-vendor cases?
Yes. Multi-vendor AP workouts are a specialty — we run a coordinated process that segments vendors by criticality, sequences negotiations, and protects ongoing operations throughout.
RESOURCES
Read more on vendor debt resolution
Playbook
Negotiation flow
1 Demand
2 Counter
3 Term sheet
4 Settled
Stretched terms vs. structured settlement: which to ask for
When to push for net-90, when to lump-sum settle, and when to do both in one negotiation.
Read article
Strategy
VS
Fight
$0
if you win
Vendor lawsuit on the AP — fight or settle?
Cost-benefit math on litigating vendor suits versus structured settlement with dismissal.
Read article
Multi-vendor
Avg. payment reduction
54%
Coordinated AP workouts: how to run 8+ vendors at once
Pro-rata sizing, sequenced outreach, and the documentation discipline that keeps it from collapsing.
Read article
GET IN TOUCH
Talk to a strategist about your vendor debt resolution case
Free initial review. We'll look at your contracts, the creditor mix, and what's actually triggerable in the next 30 days. No commitment, no sales pitch — just a real read on your situation.
Direct line
212-210-1851
Picked up by an actual case manager — no phone tree.
Email
info@delanceystreet.com
Replies within 4 business hours, 24/7 for COJ emergencies.
Confidential intake
Encrypted document upload
For uploading contracts, UCC notices, and bank statements.
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