A somewhat poetic response to a very frustrating issue and an actual comment made to me by a client this week regarding yet another un-kept payment promise.
Our clients are a maintenance response team, who look after the daily problems of keeping busy retail outlets looking good and functioning. The busier the shop, the more wear and tear. Shoppers’ expect a welcoming environment and it is crucial for customer loyalty to keep the shop looking good and functioning well.
So be it a broken light bulb to more serious issues like a non-functioning till or a broken door or leaking pipes retailers expect a first class service with skilled workmen on site and curing the problem within a couple of hours in response to a telephone call.
A Service Level Agreement always forms part of these maintenance contracts. Frequently meeting these targets is a tough call for our client, but they pride themselves on meeting and often exceeding them.
Everybody expects their suppliers to meet the agreed targets but so many customers don’t fulfil their part of the bargain and pay on time. And the BLP bank of late payment comes into play – after all it’s cheaper than an overdraft.
When put under pressure for payment some customer, threatens to pull the contract if our clients exercise their right for penalty charges which they only threaten to leverage payment.
I have no simple answer for this – a level playing field is one where everybody treats each other in the same way. A professional approach to business is what is called for. We often speak to head office accounts payable staff who realise that payment is due but it is clear they have been instructed to delay payment and we then enter the no man’s land of “the invoice is still awaiting approval and sign off before I can put it on the payment run and if it misses this week’s payment run it will have to wait till the end of the month”. Our response is, “Can I speak to the person approving the invoice?” but most times the reply is that the person is not available.
I feel sorry for staff put into this situation and I realise the retail sector is a tough one from which we have seen major high street names disappear in the last few months. This has made us even more diligent in keeping on top of payment chasing for our clients in the retail sector.
We often hear from politicians about legislating for late payment but little or no action has been taken by any government and I suspect there are too many large corporates (who are often the biggest culprits), lobbying government to block any legislation.
The only thing that works for our clients is our relentless attention to reminding customers that payment is due and creating a relationship with accounts payable staff to ensure our clients invoices get to the top of the invoices To Pay pile.