B&Q suppliers woes & how Credit Insurance can help the SME business
Reports in the press state that a previous supplier to B&Q is threatening legal action against Kingfisher group.
Terry Clark says his company TWC, failed as a direct result of their "horrendous" payment performance.
It is also claimed by suppliers that B&Q have requested payments from them for "investment for growth", the implication being that if a supplier refuses they will face losing business. More here: http://www.insightdiy.co.uk/news/bq-facing-supplier-paytostay-claims/3767.htm
John Allen, chairman of the Federation of Small Businesses (FSB) has called for such practices to be made illegal, and for the allegations against B&Q to be thoroughly investigated. B&Q signed up to the Prompt Payment Code. If the allegations are true, they cannot remain on the code, he says.
Writing in Credit Today magazine he goes on to say "We've seen too many instances of businesses being effectively bullied into longer payment terms or unfair contracts which cripple their cashflow, and have led to business failures".
For more information on the Prompt Payment Code and a list of signatories click on the link http://www.promptpaymentcode.org.uk/
Credit Insurance can help SME's in their dealings with larger companies. As an insured supplier they are required to notify late payments as a condition of cover, and consistent late payment notifications against a company can lead to their credit limits being reduced or withdrawn.
If a customer becomes aware that their late payment can lead to such notification, they are potentially more likely to adhere to your terms, to protect their other credit lines, and reputation.
Our policy also provides the added benefit of cover against debt collection and legal fees which helps the supplier's position further as often such costs can be prohibitive to a company already struggling with debts and cashflow.