Effective credit control
Protecting business through effective credit control
The news that Patisserie Valerie has recently collapsed in to administration, putting the jobs of staff at four Kent branches in doubt, follows swiftly on the news that Arjowiggins, the owner of a Kent based paper mill, has also been forced in to administration. Patisserie Valerie appears to have suffered as a result of a fraud which produced accounts looking far healthier than they actually were, whilst Arjowiggins has suffered from very difficult trading conditions. However there does appear to be one common theme for both companies entering administration; cash flow difficulties.
If a business does not have the cash flow to support its continued trading then this leads to only one outcome, regardless as to whether the accounts were fraudulently prepared or the difficult trading conditions businesses are facing at the current time.
In order to best protect your business, Brachers would recommend that you:
- ensure you properly incorporate protective terms into your agreements to protect your business if payment is not received
- educate your staff on the importance of getting the correct information and what to be aware of when an order is placed
- do not be afraid to enforce your terms, in the right case
- know the legal identity of your clients as this will impact litigation options
- understand the impact of GDPR and having sufficient and accurate data on your clients
At Brachers we can assist your business and provide advice on the current laws and best practice to protect your business. This includes providing advice on your current credit control procedures, dealing directly with your credit control needs and any potential legal claims which may be required. For further assistance on any particular issues you have or just an informal chat then please do call me.