Selling in the UK market

[HusseinSecure]

We are a trading company based in Dubai, seeking to expand our operations into the UK. We are in the process of establishing a non-resident branch company in the UK and would appreciate expert advice on several matters. Our product range includes Middle Eastern-manufactured electrical items, such as switches, plugs, wires, conduits, and trays, all of which have CE, UKAS, and TUV certifications.

We have the following inquiries:

1. What are the required certifications for importing electrical hardware products into the UK market?
2. Can we import products using our UK trade license? Non-
3. Where can we find UK wholesalers for electrical products, both online and in physical locations, as we are planning to visit the UK?
4. Is cash on delivery a common payment term in the UK, or is the market typically based on credit terms of 2/3 months?

We would greatly appreciate any insights or guidance you can provide to help us navigate the UK market effectively.

Thank you for your assistance.

Hussein

 

[Jenny Feneley1]

We are a trading company based in Dubai, seeking to expand our operations into the UK. We are in the process of establishing a non-resident branch company in the UK and would appreciate expert advice on several matters. Our product range includes Middle Eastern-manufactured electrical items, such as switches, plugs, wires, conduits, and trays, all of which have CE, UKAS, and TUV certifications.

We have the following inquiries:

1. What are the required certifications for importing electrical hardware products into the UK market?
2. Can we import products using our UK trade license? Non-
3. Where can we find UK wholesalers for electrical products, both online and in physical locations, as we are planning to visit the UK?
4. Is cash on delivery a common payment term in the UK, or is the market typically based on credit terms of 2/3 months?

We would greatly appreciate any insights or guidance you can provide to help us navigate the UK market effectively.

Thank you for your assistance.

Hussein

I can't answer all your questions but reference sales. I would say that in B2B expect to offer credit. You should set a threshold over which you credit check a customer before fulfilling an order.
Most people pay well but you shouldn't take a risk on new business with values over which you couldn't absorb a loss. I'd also suggest that you establish a relationship with customers and ensure they are reliable payers before raising your credit limit. Unless they are a well established company with a good credit rating.

Large companies HAVE to pay small ones within 60 days here. That's a legal requirement so don't let the big boys push you into longer payment terms.

Good luck!

 

[fisicx]

Large companies HAVE to pay small ones within 60 days here. That's a legal requirement so don't let the big boys push you into longer payment terms.

Never heard that before. Where is this published?

 

[HusseinSecure]

---

I can't answer all your questions but reference sales. I would say that in B2B expect to offer credit. You should set a threshold over which you credit check a customer before fulfilling an order.
Most people pay well but you shouldn't take a risk on new business with values over which you couldn't absorb a loss. I'd also suggest that you establish a relationship with customers and ensure they are reliable payers before raising your credit limit. Unless they are a well established company with a good credit rating.

Large companies HAVE to pay small ones within 60 days here. That's a legal requirement so don't let the big boys push you into longer payment terms.

Good luck!

Cheers for getting back to us! We totally get that offering credit is pretty much a given in the B2B game, but the risk of credit collection can really differ depending on the market. Like, when we're trading in some African countries, we don't do credit at all—it's cash upfront, no questions asked. The risk of losing your money is just too high, and getting it back legally is near impossible. How risky is credit collection in the UK? When we’re breaking into new markets, we usually go for cash in advance or a 50/50 split—half up front, half on delivery—until we've got a better feel for things. Do you reckon British electrical building materials wholesalers would be cool with that payment term?

Thanks for your insight

 

[Jenny Feneley1]

---

Cheers for getting back to us! We totally get that offering credit is pretty much a given in the B2B game, but the risk of credit collection can really differ depending on the market. Like, when we're trading in some African countries, we don't do credit at all—it's cash upfront, no questions asked. The risk of losing your money is just too high, and getting it back legally is near impossible. How risky is credit collection in the UK? When we’re breaking into new markets, we usually go for cash in advance or a 50/50 split—half up front, half on delivery—until we've got a better feel for things. Do you reckon British electrical building materials wholesalers would be cool with that payment term?

Thanks for your insight

As I said, people here are generally good payers in the UK, for example, you can make use of automated reminders and such, which wouldn't work in some markets like India and Africa. People like to stay on good terms with their suppliers if they are reliable. We appreciate how dependent we are on supply chains. That's not to say you couldn't burned.
Not sure about 50/50, I would say so, but of course it depends on your service and the competition, like in any market. My background is corporate and IT, maybe someone can give you better insight into trades.

 

[Jenny Feneley1]

Never heard that before. Where is this published?

Looks like it's been reduced even further. Doesn't mean businesses are complying though.
I am remembering this from a project I worked on when I worked at DHL, we identified SMEs and changed all our automatic payment terms to 59 days. This was a while ago. Here's some info:

Big companies must pay small business suppliers within 30 days - Small Business UK

Government halves late-payment window for big companies to settle invoices with small business suppliers to just 30 days, down from 60 days

smallbusiness.co.uk

 

[fisicx]

Interesting but that's just for large companies - 90% (ish) of businesses in the UK are MSME so these rules don't apply.

 

[DontAsk]

Looks like it's been reduced even further. Doesn't mean businesses are complying though.
I am remembering this from a project I worked on when I worked at DHL, we identified SMEs and changed all our automatic payment terms to 59 days. This was a while ago. Here's some info:

Big companies must pay small business suppliers within 30 days - Small Business UK

Government halves late-payment window for big companies to settle invoices with small business suppliers to just 30 days, down from 60 days

smallbusiness.co.uk

Looks more like a code of practice to me. The link to it is broken.

Where is the legal requirement to pay within X days?

 

[Jenny Feneley1]

Interesting but that's just for large companies - 90% (ish) of businesses in the UK are MSME so these rules don't apply.

Absolutely, I did say that in the first response

 

[Jenny Feneley1]

Looks more like a code of practice to me. The link to it is broken.

Where is the legal requirement to pay within X days?

As I said, it isn't broken, I had to add spaces because you can't paste links here. remove the spaces and it should work.
I also mentioned that this info is from a time I worked at DHL when we implemented it and that is what I was given to understand

 

[Jenny Feneley1]

No one had replied to the poster so I wanted to help, if people have further insight and useful info, that's great

 

[DontAsk]

As I said, it isn't broken, I had to add spaces because you can't paste links here. remove the spaces and it should work.
I also mentioned that this info is from a time I worked at DHL when we implemented it and that is what I was given to understand

?

The link you posted is not broken. The link from that page to the code of practice is broken.

You ducked the most important question so, again, where is the legal requirement?

 

[HusseinSecure]

---

As I said, people here are generally good payers in the UK, for example, you can make use of automated reminders and such, which wouldn't work in some markets like India and Africa. People like to stay on good terms with their suppliers if they are reliable. We appreciate how dependent we are on supply chains. That's not to say you couldn't burned.
Not sure about 50/50, I would say so, but of course it depends on your service and the competition, like in any market. My background is corporate and IT, maybe someone can give you better insight into trades.

Cheers, that's handy to know. It'd be grand if folks could actually respect their time and word, but of course, we've still got to stay sharp. I passed the product range on to a mate in London, and he reckons we should give Amazon or Epay a go too. We’ll dig into that a bit more

 

[Jenny Feneley1]

?

The link you posted is not broken. The link from that page to the code of practice is broken.

You ducked the most important question so, again, where is the legal requirement?

I'm not here to argue, I'm not ducking anything, I said that's what I was given to believe when I worked at DHL.
Is this tetchiness typical of this forum?

 

[fisicx]

Is this tetchiness typical of this forum?

No, but your post made a statement that members are questioning. If the law states 30 days there should be something on HMRC/gov.uk to say this. All I can find is this:

Invoicing and taking payment from customers

Invoicing and taking payment from customers, what invoices must include, VAT invoices, sole trader invoices, limited company invoices, payment options, charging for late payment, chargebacks

www.gov.uk

You can set your own payment terms.

 

[Jenny Feneley1]

No, but your post made a statement that members are questioning. If the law states 30 days there should be something on HMRC/gov.uk to say this. All I can find is this:



You can set your own payment terms.

OK, I can delete it if you want? I don't appreciate being accused of ducking questions, that's really confrontational, I came here to try and have sensible professional discussions. If that's not here then that's fine, I'll try somewhere else. I'm happy to be questioned and corrected, I just find confrontation exhausting.

 

[fisicx]

It’s not confrontation, it’s just seeking clarity.

 

[japancool]

It seems to say that the 30 days is the default unless other payment terms are agreed:

Late commercial payments: charging interest and debt recovery

Late commercial payments - interest and debt recovery costs you can charge businesses for late payments

www.gov.uk

 

[Mark T Jones]

In reality the payment code is toothless - the penalty is paying interest, but most small businesses won't risk the relationship to enforce it.

It isn't a given that you have to offer credit (it tends to vary by industry). Or simply no payment, no goods.

Look at alternatives, such as discount for pre-payment.

If you are offering credit it is essential that you have a solid collection process in place. A process that starts before you offer terms, not once payment is late.

Definitely consider credit insurance.

 

[HusseinSecure]

Thanks a bunch for all your input, really appreciate it. It’s given me a clearer picture on my fourth question. Could I ask the respected members here to shed some light on the first three questions?