SYSTEM HELPS SMALL CHAIN DEAL WITH BAD CHECKS

SANTA FE SPRINGS, Calif. -- Superior Super Warehouse here has accelerated implementation of an online check-processing system that rapidly updates its bad check file to increase collections and clear paid accounts.Based on a one-store test of the system, from JustChex, Oxnard, Calif., the 15-store chain decided to "move up our plan for deployment by several months," said Cris Nunez, risk management

SANTA FE SPRINGS, Calif. -- Superior Super Warehouse here has accelerated implementation of an online check-processing system that rapidly updates its bad check file to increase collections and clear paid accounts.

Based on a one-store test of the system, from JustChex, Oxnard, Calif., the 15-store chain decided to "move up our plan for deployment by several months," said Cris Nunez, risk management supervisor, Super Center Concepts, parent company of Superior Super Warehouse, in a prepared statement. "We are getting better financial returns, and our collections, IT and accounting departments all benefit from the improvements we have seen in data integrity and reporting."

Super Center Concepts operates a chain of independently owned grocery supercenters in Southern California, including 15 locations under the Superior Super Warehouse banner.

Checks deposited into a supermarket's depository accounts via the JustChex solution are marked with a franking code that routes the checks to a centralized account if they are returned. Once in that account, check data get imported into JustChex's database, and checks proceed to the collections process.

When a bad check is paid, the system automatically updates itself to clear a customer's account. This feature is important for supermarkets because of their high degree of repetitive business, noted Richard McShirley, director of business development for JustChex. Customer service benefits from a system that accurately reflects the account standing of its customers, he said.

Retailers make no initial investment for the JustChex system. JustChex's payments come from state fees received after the processing of returned checks. "JustChex delivered us an end-to-end check-recovery solution with data-processing automation, with no investment," Nunez said.

In its one-store test, Superior found the solution increased the amount of money recovered from bad checks, McShirley said. (Superior was unavailable for comment apart from prepared statements.) Prior to the implementation, he said, Superior needed personnel to intercept bad-check data and validate it -- a time-consuming and costly process. "In the collection business, the newer the checks, the higher the collection rate," he said. "It is very important that these checks don't lie around."

The JustChex solution is particularly suited for chains that lack systems sophisticated enough to cope with negative file data, said McShirley.