Tag Archives: late payment

Weekly digest

The week completed, 24th July 2014

JMS

This week saw a visit to Kings Lynn to meet a new business with aspirations for growth. The proprietor, a recent graduate, is trying to start a business importing merchandise for sale to universities and their under and post graduates.

The ambitious entrepreneur has no security to offer any funder but has unlimited enthusiasm, strong IT skills and a solid working knowledge of all aspects of student life. Without finance there’s little point in progressing as the overseas suppliers will allow no scope for credit.

A business plan has been prepared which is a cogent document and demonstrates a good degree of research into the market to be entered.

What’s interesting here is the reaction of his bank, being dismissive in a patronising and unhelpful manner. I’m not sure funding will be forthcoming from any source but the attitude of the bank is immensely disappointing and does not reflect well on the organisation.

Whilst this particular plan may not come to fruition I’m confident a future one will. My guess is that the bank, so dismissive in its rejection of this proposal may not win the business in future.

uk-black-mortar-board-600-500x500

 

A delightfully ironic story in The Times this week as it reported on the watchdog created to prevent small suppliers being bullied by the supermarkets running into trouble itself after revealing some of its own received invoices may not have been paid on time!

Weekly digest

The week completed, 30th January 2015

JMS

In the exciting, unpredictable world of self employment come days, weeks or even longer when little of interest to me, let alone the outside world, takes place. The week finishing today concludes such a time.

As months go the invoice finance world appears to have been a quiet one with overall feedback suggesting businesses are reluctant to commit to either new or different facilities. The range of facilities available is pretty extensive, from the historically conventional to the newer, innovative funding sources.

After last weeks rant about large businesses taking too long to pay their suppliers it was interesting to hear the CEO of Diageo on the BBC Radio 4 Today programme.  Diageo had come under fire for extending terms to 90 Days;  somehow their CEO managed to describe this as a ‘win/win’ position for both Diageo and their suppliers.

Ironically Diageo is a signatory to the Prompt Payment Code.

I’m sure suppliers whose cashflow is adversely affected by this unilateral move may struggle with the ‘win/win’ phrase. This culture of late paying will only change with continued pressure on those guilty, legislation would not work.

Next week hopefully will see an increase in activity,  helped hopefully as some of the accountancy profession will re-surface after the self-assessment deadline.

 

yawn

Weekly digest

The week completed, 12th December 2014

JMS

Christmas is most definitely here and businesses are deferring decisions to the New Year. This can be a little frustrating as funders are willing to offer and complete facilities and there is still plenty of time.

Two dreadful instances this week of large businesses deliberately extending payment terms to small suppliers seemingly with no legitimate reason. There’s no good time or reason for this practice and some large buyers seem to adopt an unacceptable almost macho stance in squeezing suppliers.

Without the permission of my client I clearly cannot name these well known businesses. Its a recurring and ongoing subject and sadly for SME’s I guess will continue.

I will be losing my bet, made this time last year, that Bank of England Base Rate would have risen from 0.5% by Christmas 2014. (Given the absence of any further MPC meetings this year Base Rate will end the year at 0.5%). Economically Base Rate needs to rise next year but this is unlikely before May. Although the Bank of England sets Base Rate free from political interference, I am a cynic!

The week has been punctuated by a couple of Christmas networking events with more next week too. Also next week will see a visit to a High Street to give the retailers a boost.