From a supplier’s
perspective the most important part of any transaction is to ensure prompt and
satisfactory receipt of funds for goods or services provided.
When a company oversteps the mark by abusing agreed payment terms they are in fact using the seller’s tolerance as means of providing an unsecured overdraft.
Put simply would you exchange a promise from your buyer for prompt settlement conditional on your company providing the upfront funds enabling them to do so?
In reality by continuing to supply a persistent late paying account this is exactly what is happening.
It is a question of commercial judgment.
In these present trading conditions business is hard won but if the transaction carries a disproportionate risk then it isn’t worthwhile.
The time and effort spent chasing a recalcitrant account could be better spent elsewhere.
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