show me the money
(First published - March 11th 2016)
It's fair to say that as human beings we all suffer from some degree of anxiety in our lives, this could be anything from first date nerves, to dentist appointments and beyond...
That said, I think when tackling issues surrounding mental health, anxiety is a term that most can relate to when trying to get their head around the emotive tendencies of someone with a disorder of some kind...
Where I have always found anxiety at it's worst in terms of running my own businesses, is money!
Now, we've generally got two types of relationships customer wise with our businesses.
One is where we run pro-forma invoicing for new clients, thus alleviating anxiety by covering our bases with an up front payment...
And the other surrounds setting payment terms; this is where, depending on the gravitas of your organisation, you can rake other companies across the coals with varying degrees of intensity, in order for you to maintain status, cash flow and ultimately a healthy, non anxiety driven lifestyle...
The latter is where my frustration hits!
A companies liquidity lives and dies on the strength of their accounts department and the common mission within an accounts team is to chase money in where possible and avoid paying anyone where possible.
Some will tell you that the above is not true, but lets face it, that's because we're British and we don't talk about things like this... That doesn't mean that it doesn't happen...
On regular occasion we have clients ducking payments and we're constantly trying to work with bigger businesses, while aiming to avoid keeping credit terms lengthy. Thus is the epitaph of the SME!
The difficult bit is trying to remain calm... For example, if a customer decided not to pay you until they fancy doing so, what are your legal rights? And is there any point in having any at all?
I recently had a cafe/ice cream parlour, who funnily enough were across the street from my office building and we produced a whole range of uniforms for them for a nominal amount around the £550 mark...
Now, we invoiced them last year on the 21st December and we did them a favour as a local business, by giving them 30 day payment terms and producing all the uniforms quickly and efficiently to ensure their brand tone of voice was presentable to their consumer base.
We are now here on the 11th March, still waiting for the nominal fee and after numerous emails and multiple promises to pay 'next week, then the week after, then the week after etc.' we've lost our patience, to a degree, in terms of whether to maintain a polite standpoint or not...
A couple of weeks ago we put the pressure on and were promised payment by the end of February, then upon chasing my Financial Controller spoke to the owner of the business who was abusive and hung up...
Stalemate!
So, I get a text 5 minutes afterwards from the owner, telling me how nasty my staff are (bearing in mind my Financial Controller is also my fiancé, who runs her own Accounts and Bookkeeping company) and I fully understand how she actions late payment processes, because I've hired a plethora of accountants in the past to avoid working too closely with my partner, only to have a poor level of service and reverting back to her definitive knowledge in the field.
I call the business owner and he repeats his derogatory points about my future wife, to which I remain calm and reply, "it's fair to say that if my Financial Controller seems to be more emotive at this stage, it's only down to the fact that we're rocketing into the 90 day realms for a nominal payment for goods delivered within a week of being ordered and now your taking liberties"...
Lets remind ourselves at this point, of the fact that this business is literally across the street, so I can see them from my window... And that had this small order been from another town, I'd have charged him 100% up front as his first order to build the initial trust.
I decide to take a wonder...
Businessmen, who bully women and avoid payment for prompt and professional services, it's safe to say I'm not a fan of. But I also know that they like to avoid anyone getting wind of their potential lack in credibility...
Now, I didn't (regardless of my mental health concerns) run into his establishment chanting 'Show me the money!' - I casually wondered up to the counter, asked when he might be arriving and upon being told that he would be there soon, decided that I'd buy a bottle of Coca Cola (none of the crap, wannabe Coca Cola, only the good stuff might I add) and wait for him...
The staff member asked if he could help and what the issue was about, so I told him that I technically still owned the clothing he was wearing to serve me in, because I haven't been paid for my services and I'd like to deal with this issue. He promptly offered me the Coke for free and I graciously accepted. (Good staff are hard to find after all, so I didn't want him to be made to feel uncomfortable!)
5 minutes later I receive a call from the owner promising payment by the end of the week and I accept his apologies, regardless of his 'dog ate my homework' type excuses an went back to my office and back on with my business...
Now, Friday comes and today I'm sue payment, but I don't get any contact from the businessman to let me know either way, instead, he texts my Financial Controller at about 7.30am and tells her that we will pay on the 15th, another 4 days away. Very blunt, very direct, very matter of fact!
So what would you do?
Well, bearing in mind this is less like the 4-5 previous empty promises and more like a statement of intent that we have to accept regardless, I lose my patience at the further extension, because what happens on the 15th, will it then be the end of that week, the end of the month, new financial year? Who knows?!
I call my legal team, we have the same lawyer which is unsurprising as he's just round the corner so I'm offered some generic information to avoid conflict of interest.
I then send an email with the invoice again stating that I will allow for payment on the 15th, however, should he default on this I will backdate an 8% surcharge on the gross for late payment on any months he's overdue by. I also state that I will print a copy of the email and invoice and have them delivered by hand, should the email magically get trapped in the old mythical spam filter, to ensure he has a copy and understands the final terms.
Am I allowed to use the word 'ball ache' in a blog?!
The simple outcome is that who knows whether that payment will come in? My company won't fail or prevail off the back of £500, however the principle of courtesy still remains.
I find it difficult to respect any business small, medium or large, who let other down when they have an agreed term in place and it's still less fair to do someone a favour, only to have them spit in your face.
The bigger the company gets, the less likely your paid on time and the quicker they are to jump on you should you be struggling with cash flow.
What I don't understand is, why can't we all just respect each other as business professionals? If you do a job I pay you, if I do a job you pay me, and if we all pay on time then everyone has a lovely successful business without the anxiety and wasted time. In addition we wouldn't waste hours and hours asking legal professionals where we stand, paying out extra money taking people to court, or in the case of someone with a mental health disorder feeling sick at the lack of good karma others seem to want to employ.
It may be worth you noting my blog on the Theory of Ethics at this point...
Our system is designed to fail; the weight is with the big boys and every company regardless of size, knows that you don't really want to spend more money and time taking them to small claims court to recover lost revenues.
Caveman style, we'd wonder over, club in hand and ensure that we got the bit of dinosaur meat we deserve... Some businesses even operate like that...
The point is, where do we draw the line, I hate this feeling and this lack of respect for fellow human beings. is this something that could be government lead? Is this a dip in our legal system that could eventually be remedied? I suspect not, because the big boys sit pretty and the little dodgy guys aren't fussed which route you take because it's as easy to flip your assets to a new limited entity and write off the old debts as it is to 90mph on the motorway provided there's no camera, and everyone in between will turn a blind eye as long as it's not them under the wheel tread...
Maybe this just comes down to another happy Friday, or maybe this is something we need to consider in terms of how we reformat our societal structure to better support the small businesses and the ethically adapt?
Jury's out for now... I'll let you know on the 15th! Now I'm off to chase the others...
