COMMENT
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CREDITS AND DEBITS
regularly encounter smaller contractors who
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6 are carrying on in business with no trading terms, no useful knowledge of their cus tomers' financial standing and little idea of how to go about pursuing customers who've not paid their account." Does that sound like you? Then don't expect to be in business this time next year. That indictment of the British haulage industry might ruffle a few feathers. But according to past figures from the Forum for Private Business there's been a 50% growth over the past two years in the number of firms which see late payment as a serious problem, with FPB members in the transport sector owed on average almost three times what they owe. They also have to wait an average of 77 days against their "normal" 30 days for payment. Yes we know poor cash-flow is one of the main reasons road transport companies go belly up. But what are we doing about it? One of the simplest first steps should be to lookat your terms and conditions. According to debt recovery agent James Campbell, all too many hauliers trade under woolly, or even non-existent, terms and conditions. No wonder so many hauliers get taken to the cleaners. When was the last time you looked at your average debt collection period. Has it gone up or down? It's not difficult to work out— divide your typical total out/ standing sales ledger by your J, annual sales and multiply by 365. If it's taking you longer to get paid what do you propose to do about it? And you always credit-check a prospective new customer.... don't you? Spending some of your own money up front might mean avoiding waiting for someone else's money that might never come. Talking of which we'll simply say: "Over to you Monsieur Jospin, over to you "