Maintaining a good relationship with your customers is obviously important, but how long should you wait for payment? Getting paid on time can be critical and this was illustrated to one of our valued clients recently, Martlands Waste Solutions Ltd.
On 5th October 2012, Martlands asked us to recover a long outstanding account from Clayton Commercials Limited and some of the invoices had been outstanding since November 2011. We are pleased to report that we collected the account in full, payment was made immediately by Bacs, including interest and compensation, within 2 Hours of Martlands instructing us, which is not bad even by our standards.
But that is not the point of this matter. Fast forward 6 weeks and Clayton Commercials Limited went into Administration on 14th November 2012:
Clayton Commercials Limited were not a ‘5 minute wonder’, they were incorporated back in 1972 so they were a well established company and this goes to show that this can happen to any company, large or small and therefore reinforces the need to keep a vigilant eye on cashflow and act sooner rather than later.