Agency change of payment terms

[JoJoGabor]

THis has all the signs of them about to go pop, so there is probably more than a 50% chance you will lose money. If they have not met the payment terms in the contract, the contract is void. I would have a word with the client and ask to move to a different agency.

Don't go more than 7 day payment terms at all, I would even ask for a rate increase stating you've done a credit check and the risk has gone up with dealing with them, and make sure you have PCG+ insurance.

[Safe Collections]

Thats for suggestion - plan to stand firm on the 7 day and see what they come back with.

FYI, I did an Experian credit search and they are certainly a mixed bag with a worsening payment pattern and Experian rate them as high risk (on the cusp of maximum risk) mixed with a handful of positives..

Good to see you already pulled a report, it certainly sounds like the agency has significant problems. Are you locked into the contract in any way or can you use a different agency? If you are locked in it might be possible to use the increased risk as a means of negotiating your way out...

If they have not met the payment terms in the contract, the contract is void.

Actually it is our understanding that late payment in and of itself, does not necessarily give rise to a breach of contract. In an ideal world you would need to have the entirety of the contract reviewed to ascertain if a breach has occurred. Just so you know

[Gordon Ice]

- First reaction would be to tell them to jump and kiss my royal a**
- Once I'd calmed down I'd be busy negotiating the newly proposed terms to something I am comfortable with (e.g. fortnightly billing); it's all about how much exposure you're willing to take against the risk the Agency goes bust. PCG Plus offers you some cover for this scenario and is IMHO worthwhile.
- Be careful of the usual trick of the Agency offering 30 days with monthly invoicing - at its worst this is essentially 60 days payment terms :-(
- Worst case if you have no other option than to accept 30 days terms insist on weekly invoicing

And about those late payments, I suggest you get busy with some kind of credit control and demonstrating that you aren't prepared to take sh*t. Read up on the Late Payment legislation and get busy rattling their cage - https://www.gov.uk/late-commercial-p...-debt-recovery

Think like a business, act like a business.

[Boney M]

Get out of there and use another agency on the clients approved list

[TykeMerc]

Thats for suggestion - plan to stand firm on the 7 day and see what they come back with.

FYI, I did an Experian credit search and they are certainly a mixed bag with a worsening payment pattern and Experian rate them as high risk (on the cusp of maximum risk) mixed with a handful of positives..

That alone would make me give them an emphatic no with absolutely no room to negotiate. Under no circumstances would I agree a negative change to payment terms and any lateness would see them put on stop immediately with breach of contract action following rapidly, I'd put that in writing too.

I would also say since you know the client so well that a subtle word would be wise.

It's your business risk and up to you to manage it, with what you describe I'd be ultra cautious.