Persistent late payer.....

Discussion in 'Cashflow forum' started by roydmoorian, Jun 10, 2015.

  1. roydmoorian

    roydmoorian UKBF Ace Full Member - Verified Business

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    When a company persists on paying at 90 days after being told that our terms are 30 days (we factor and so cannot change from 30 day payment terms as it is part of the deal) are we entitled to charge a £40 fee for every late paid invoice even after that invoice has been paid ?

    The Co. in question has gone elsewhwere for fulfillment of the service we offer as they have a new broom in the purchasing dept who has "benchmarked" our service to them and decided that they will pay us less than we pay our sub-contractors so I have no qualms about "losing" their custom to a significantly poorer and unsustainable service .
     
    Posted: Jun 10, 2015 By: roydmoorian Member since: Nov 6, 2009
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  2. john1989

    john1989 Guest

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    Not sure you can charge £40 - what was in your t&c's / contract with them?

    Only just noticed, you're only up the road from me (Castleford)!
     
    Posted: Jun 10, 2015 By: john1989 Member since: Jan 1, 1970
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  3. roydmoorian

    roydmoorian UKBF Ace Full Member - Verified Business

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    Posted: Jun 11, 2015 By: roydmoorian Member since: Nov 6, 2009
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  4. john1989

    john1989 Guest

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    The charges are not per invoice but the total debt owed.
     
    Posted: Jun 11, 2015 By: john1989 Member since: Jan 1, 1970
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  5. smallclaimsassistance

    smallclaimsassistance UKBF Enthusiast Full Member - Verified Business

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    If you've lost the account and are not worrying about upsetting them, why don't you sue them? If they have accepted your terms which say 30 days, it's unreasonable for them to maintain that they pay at 90 days because that is their practice. You can also claim enhanced interest under the LPCDI Act.
     
    Posted: Jun 11, 2015 By: smallclaimsassistance Member since: Jan 7, 2015
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  6. roydmoorian

    roydmoorian UKBF Ace Full Member - Verified Business

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    They had been paying quite consisently on 30 - 60 days for about 8 years but then became slow payers and upon investigations from us we discovered that the had put us un their 90 payment schedule without telling us. We of course said that we did not accept this and increased our prices to them by 3% giving them similar notice to that which they gave us regarding the extended payment terms. We are still charge only average rates for the industry and considerably less than some.

    Maybe financial alarm bells should be ringing and they are in major difficulties - Their main output is own label goods produced for supermarkets etc
     
    Posted: Jun 11, 2015 By: roydmoorian Member since: Nov 6, 2009
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  7. smallclaimsassistance

    smallclaimsassistance UKBF Enthusiast Full Member - Verified Business

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    Agree. Sounds like they could have cashflow problems.
     
    Posted: Jun 11, 2015 By: smallclaimsassistance Member since: Jan 7, 2015
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  8. nelioneil

    nelioneil UKBF Enthusiast Full Member

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    Or it could be the work of a bigger corporate. From experience, some of the very large FTSE companies pay (and if they are nice, negotiate) for 60, 90, sometimes even 120 days after invoice date.
     
    Posted: Jun 13, 2015 By: nelioneil Member since: Jan 22, 2013
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  9. Geoff T

    Geoff T UKBF Legend Full Member - Verified Business

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    Again - some mistakes here folks...

    The Compensation charge referred to by the OP under the LPCDIA is officially "per contract" not "per invoice", nor is it "per account" as hinted at above... But in the absence of an ongoing contract, then "per invoice" is more applicable, because without the ongoing contract - then there is an argument that each invoice is a contract in and of itself...

    Depends what was set up and how at point of sale...

    As for cashflow - that's pretty much to be taken as read, as supermarkets usually pay late, so if they supply them, they will be getting paid at about 70+days, with margins cut to the bone...
     
    Posted: Jul 29, 2015 By: Geoff T Member since: Apr 30, 2009
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  10. John Crowder

    John Crowder UKBF Contributor Free Member

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    So many times the last one in the chain provides cashflow for the companies above them.

    Frankly you have to pay for factoring so why shouldn't they.

    In most cases you have to put up with it because you need the business.

    I'm glad you don't have to in this case.
     
    Posted: Jun 7, 2016 By: John Crowder Member since: Jun 6, 2016
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  11. roydmoorian

    roydmoorian UKBF Ace Full Member - Verified Business

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    We are now working for this company again, but on our terms.The main reception books us and pays by purchasing card so that their Head Office does not realise who they are using. The sub-contracted on-site maintenance department is also using us again but instead of invoicing their customer to be passed forward as was the case we now invoice them direct.
     
    Posted: Oct 29, 2016 By: roydmoorian Member since: Nov 6, 2009
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  12. profitxchange

    profitxchange UKBF Ace Free Member

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    Well done. Not all big co's pay on 90 days whatever, I know one of the high street co's that pays on 30 days to small businesses. To some degree its the relationship you have with them. As you have found edicts can be circumvented.
     
    Posted: Oct 30, 2016 By: profitxchange Member since: Apr 16, 2005
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  13. roydmoorian

    roydmoorian UKBF Ace Full Member - Verified Business

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    Strangely enough we are OK with 90 days payment terms if we actually know about them in advance -

    Our beef was that a "Purchasing Executive" told us what the loaded mileage rate would be.and it worked out to be less than we pay our sub-contractors.

    Basically we were being significantly undercut by someone who did not provide the same level; of service and has now gone out of business. The plant has stopped on more than one occasion for lack of urgent parts.
     
    Posted: Oct 30, 2016 By: roydmoorian Member since: Nov 6, 2009
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