Sudden Business Closures - Will You Get Paid?
Profitability and cash flow are the lifeblood of any business.If any of your customers are experiencing an issue with one of these, it can have a long-term effect on the performance of the business. If they are experiencing issues with both, then it is imperative that it is resolved as soon as possible, or it could result in the business being insolvent or unable to pay its debts.
As a business, it is important to ensure you monitor the payment behaviour of your customers. This way you can identify early signs that your customer is in trouble. No matter the size of the business, insolvency and liquidation can occur at any point.
Business insolvencies in Scotland have risen by 14% in a year, new figures by KPMG indicate. The UK as a whole have seen the largest rate of insolvencies since 2012. So it imperative you review your ledger and act now.
We are only just into 2019 and some major players have gone, in the last week McGills collapse has had a ripple effect within Land & Building Services Ltd who are now being placed into administration. McGills had been successfully servicing the Dundee community and surrounding areas for over 38 years, employed around 400 people and had a turnover of over £40m, yet it found itself in difficulty. Directors at the company are quoted as attributing this to market conditions and contract disputes as being key in their downfall, ultimately a cash flow issue.
Other construction related difficulties are being experienced by the troubled UK outsourcer Interserve, who have been on the ropes for over a year as they currently work on salvaging a rescue deal. Only this week it is reviewing plans to secure debt against one of its most profitable companies in its group, as well as offering debt-for-equity in a new share issue to its lenders. In the meantime, one of its major shareholders, Coltrane Master Fund, has called for eight of the company’s directors to be removed by way of calling a general meeting to discuss the proposal.
No matter what size of business you are or deal with, liquidations and administrations can hit any business at any time. However, you can protect your self against being caught up in the crossfire by acting early to overdue invoices and engage the service of someone like Darcey Quigley & Co. January last year, saw one of the industries biggest collapse in the demise of Carilion. Despite a portion of this would be paid out through credit insurance (estimated to be around £31m in pay-outs from credit insurers) it was a drop-in the ocean against the reported £2 billion which subcontractors and suppliers lost as a result of the liquidation as quoted by a recent parliamentary committee.
Many firms across the country are still suffering from the collapse of the construction and outsourcing giant. Hawk Plant (UK), one of the biggest independent plant hire companies in the UK, has gone into administration. The group, based in Press in north west Shropshire, had a turnover of £93.5m in the year to December 2017. But the company, which has more than 40 years experience in the plant hire industry, noted in its annual accounts for 2017 that it had been hit by the liquidation of Carillion in January 2018, resulting in the rescheduling of some of its contracts.
Insolvencies in this sector have doubled in two years. According to Dun & Bradstreet data published in November 2018 construction insolvencies in Q3 2018 reached 677, compared with 340 in Q3 2016. The increased numbers in 2018 remained steady, with 662 being recorded in Q1 and 688 in Q2 2018.
Remember, TIME is not on your side. That’s why you need to service of someone like Darcey Quigley and Co. We will action your case within an hour of receiving your outstanding invoice. We act fast and will be on the phone to your debtor to open up communication and get to the source of non-payment.
You only pay our fees if we are successful in securing a payment. If we are unsuccessful in getting your debt paid then we do not charge for our services, it is as simple as that. All fees are agreed upfront, and we keep you informed throughout the process from start to finish.
We act as an extension of your credit control process. We are experts in our field, allowing you to get on with running your business with the peace of mind we are working on your behalf.
If you have any worries about your customer, call us and we will run a credit check and offer free advice on what options are available to you. Call us now on 01698 821468 or email us directly on firstname.lastname@example.org