New slant on factors
Page 10
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by David Craik • Hauliers are to be offered a new credit management service that has been evolved within the fishing industry.
The scheme, to be named the Road Hauliers Credit Management Agency, will administer the payment terms of its members and aims to improve their cashflow and reduce debtor days.
Banchory-based A&J Fitzgerald will run the operation which differs from factoring as the hauliers get all the money invoiced. "Small hauliers are often too overworked to concentrate fully on invoicing. We can do this full time for them every day. There are currently hundreds of hauliers going out of business because of nonpayment," the company says.
The agency will aim to reduce the risk of exposure to potential bad debts by being able to recognise them early and applying professional collecting techniques. Each member has to supply a weekly list detailing all invoice numbers and amounts issued to their customers. Kidsons Impey Chartered Accountants will he RHCM's accountant auditors.
The agency, which will charge a weekly administration fee of about £20, will follow the model of a similar Fish Merchants Credit Management Agency.
"We set that up in January 97 and it has proved very successful," says the company. "We have members from Plymouth to Peterhead. They say their cash-flow has improved and that debtor days are down. They have more time to sell fish rather than collect money."
Credit insurance at a far reduced rate is soon to be introduced for the fish merchants by the FMCMA—a scheme which could also be introduced for hauliers.
Contact: 0345 585 219 (charged at local rate).