I consider myself lucky to have none of the huge retailers as customers. Everywhere I go, I hear some sad story about how a small company has been forced out of business (often with personal bankruptcy) simply because a large retailer wouldn’t pay their bills on time.
Similarly, I also hear tales of how small firms have suffered by having huge payment discount levies placed on them. It’s a case of: “We’ll pay you the £500k now but, if you want this job again, it will be less a credit of £100k.” Again, we have another small-business casualty.
This used to be at least restricted to some major buyers. Now we have a situation where not only are companies of all sizes trying it, but the general public are as well.
Our main customers are interior designers and part of their business is residential homes. We’re often faced with situations whereby our customer (the designer) is given a whole house to overhaul. Joe Public then nitpicks on faults, down to the tiniest scratch on a door handle and a piece of furniture they decide they don’t like anymore. They then announce that the poor designer won’t get paid anything at all for the job until the tiniest quibble is put right, and the pieces they have changed their minds about are replaced free of charge.
Desperate to be paid, the designer has no choice but to agree and then turns on us – the supplier – and behaves in the same way.
The obvious solution for us all is to put our prices up to build in more preventative percentages to cover all these situations. However, that is catch 22: the market won’t bear increased prices so we won’t get the work.
There are, of course, other ways of dealing with this, such as putting in clauses of interim payments (which again may mean you don’t get the work) or crediting particular items that are under discussion and trying to insist the bill is paid.
However, if someone is refusing to pay and your only recourse is the legal system, you’re in for a very long wait indeed.
There needs to be some massive and urgent legal reforms to prevent these utterly unjust practices. As long as this absolutely amoral behaviour continues with the blessing of the powers that be, it will become increasingly impossible to do a fair day’s work for a fair day’s pay.
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