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Just a thought…
What if the TA were to give it’s members credit ratings on companies from the likes of Euler? Would Euler insure debts carried by TA members I wonder?
http://www.eulerhermes.co.uk/en/credit- … rance.html
That would be useful, not costed it though, just a thought.
The reason being that there’s at least one company that many of us work for and, give credit to, that I know have a credit rating of zero. 😉
It could bring several people to their senses and teach credit control.
K.
Re: Random Thought In The Current Climate
interesting agreed ,if only so members can do work for someone with there eyes wide open .
Mind you they will still do work if there is no viable alternative .
LawrenceRe: Random Thought In The Current Climate
Agreed.
And you knew this was coming… but…
Where you know what the credit rating is you can take a far more informed decision on what level of risk you will accept on any one account. Even if the debt is uninsured you at least, as you say, go into it with your eyes open knowing if it’s a good or bad bet.
The thing of it is, what do the repairers have now?
What with some people shifting responsibilities from the client to the third party in the ether that you don’t deal with, see payment histories or even have to deal with on any level it is likely the best you can get.
What I can tell you, although I obviously have to be careful here as it’s confidential, is that one company that passes work to many of the guys on here has a credit rating of zero. I know this, I’ve seen the Euler report. Yet, we all extend credit and wait (usually) sixty days for payment and, I also know that’s different terms for service than other suppliers are on. Most others get paid in thirty days or less or, if the account hits the credit limit, it’s cash with order.
Even with a low turnover, say £500 per month, that’s a potential liability of around £1500 once you consider what’s invoiced, due, not due and then not yet billed on top.
Yet Euler won’t give any insurance on any debt of any amount for this company.
But, with say, 40 agents around the UK they’ve probably got the best part of £50K unsecured credit that, if they went pop tomorrow, the guys have no hope of recovering. Added to which, they had no idea that said company was even remotely insecure.
Credit ratings aren’t the be all and end all but, they do help massively in determining just how much of YOUR money you want to take a punt on with a client.
K.
Re: Random Thought In The Current Climate
I don’t do any contract work at all but here’s my thoughts for what it’s worth…….
This company also offers debt collection, including aged debt which would definately interest some members; question is, how much do they charge? The site also doesn’t state the lowest level of debt they would touch. This scheme would have to be WTA run and possibly funded. But in the light of the MFI debacle that info could have possibly saved a lot of people that found themselves exposed to sizeable losses and grabbing collection agencies.Steve.
Re: Random Thought In The Current Climate
I guess that’s sorta the point really Steve.
If you look around you’ll see that the people that do no contract work at all are actually the minority, most will do work on a contract (where they send a bill out and await payment) with someone whether it’s a WP or whatever or a letting agent. It really makes no odds who the bill goes to, the same rules apply.
I was pondering the thought of factoring as well as that’s quite good but, where there’s no “invoice” as such raised, such as on the CDSL system among others, it’s difficult. It does however pass off credit control and give instant cash.
K.
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