Paying supplier by direct debit

[Spoiler]

£5K or £35K?!?! [spits mouthful of tea out all over keyboard]

Yeah, sorry about that !

We did it initially as it seemed to be the way to sort out a credit account with them.

[kingcook]

Thanks all. I'm still inclined to cancel the DD and be in control. The payment amount will vary monthly, it could be £5k or £35k (more hopefully!). I'd like to be in control of cash out of the account as much as possible.

I will speak to my bank manager-type person about this, but I would guess I need to advise both parties (bank & supplier) that I'll be cancelling the DD?

£5K or £35K?!?! [spits mouthful of tea out all over keyboard]

There is no way i'd have a Direct Debit for that!!!!! Manualy payments would be winner.

[Spoiler]

Even if it's a fixed amount, you can easily setup a regular payment. I would be inclined to not use a DD for business stuff because the amounts can be large and I would want to control exactly when the payments were made.

you can cancel a DD quite easily if you want to and switch to other methods though this may upset your supplier. :-/

Thanks all. I'm still inclined to cancel the DD and be in control. The payment amount will vary monthly, it could be £5k or £35k (more hopefully!). I'd like to be in control of cash out of the account as much as possible.

I will speak to my bank manager-type person about this, but I would guess I need to advise both parties (bank & supplier) that I'll be cancelling the DD?

[Wanderer]

I can see the benefit of paying some invoices by DD, when the amount will be a fixed outgoing (things like accountancy fees, etc). But the supplier invoices will change monthly depending on the amount of business we've done.

Even if it's a fixed amount, you can easily setup a regular payment. I would be inclined to not use a DD for business stuff because the amounts can be large and I would want to control exactly when the payments were made.

you can cancel a DD quite easily if you want to and switch to other methods though this may upset your supplier. :-/

[Precept]

Control of cash-flow

If your supplier would have significant control of your lifeline (cash-flow) it would be necessary for you to ensure you always have reserves of cash to call on. Alternatively, make sure your invoices are always settled early too.

[BolshieBastard]

DD should be fine. If you know there is money on the account, the variations aren't too great and you trust the supplier fully.
It saves the hassle of invoicing, making payments etc. Theoretically any DD supplier is fully vetted and in fact DD is the only payment with a guarantee if there is an error - and you can go to your bank and get a refund. The smart way to pay - Direct Debit Guarantee

Yes, the DD guarantee does say all that. but, as I said, if a payment goes wrong, see how many hoops you have to go through to get the money back. The banks will frequently tell you you have to approach the receiver of the money and ask for a refund. You then have to engage in a debate with them about the guarantee and it being their responsibility.

I know plenty of people including myself who have been fobbed off by banks in these circumstances.

If you really cant be arsed to spend a few minutes a week sorting out bills and payments (including advance payments), then fair enough but, I dont favour handing over control of my account to different suppliers so they can debit what they want, when they want.

Each to their own though.

[saptastic]

Our Co recently signed an agreement with a distributor to resell hardware/software. When setting up the account, which included receiving some credit, we also signed up to paying invoices by direct debit.

I'm now thinking I'd like to be in control of paying invoices, and not have the DD automatically take the money.

Is it normal to pay invoices to suppliers by DD ?

I can see the benefit of paying some invoices by DD, when the amount will be a fixed outgoing (things like accountancy fees, etc). But the supplier invoices will change monthly depending on the amount of business we've done.

DD should be fine. If you know there is money on the account, the variations aren't too great and you trust the supplier fully.
It saves the hassle of invoicing, making payments etc. Theoretically any DD supplier is fully vetted and in fact DD is the only payment with a guarantee if there is an error - and you can go to your bank and get a refund. The smart way to pay - Direct Debit Guarantee

[BolshieBastard]

Our Co recently signed an agreement with a distributor to resell hardware/software. When setting up the account, which included receiving some credit, we also signed up to paying invoices by direct debit.

I'm now thinking I'd like to be in control of paying invoices, and not have the DD automatically take the money.

Is it normal to pay invoices to suppliers by DD ?

I can see the benefit of paying some invoices by DD, when the amount will be a fixed outgoing (things like accountancy fees, etc). But the supplier invoices will change monthly depending on the amount of business we've done.

Nope. When I had a retail outlet, I never paid any bills by DD. As you say, it hands the power over to the supplier. If they ever do make a mistake and take too much (weird how they never take too little), try getting the money back and how many hoops you have to jump through!

Always paid the bills by internet banking.

You need to be in charge of when money leaves your account, not someone else.

[Maslins]

Our Co recently signed an agreement with a distributor to resell hardware/software. When setting up the account, which included receiving some credit, we also signed up to paying invoices by direct debit.

I'm now thinking I'd like to be in control of paying invoices, and not have the DD automatically take the money.

Is it normal to pay invoices to suppliers by DD ?

I can see the benefit of paying some invoices by DD, when the amount will be a fixed outgoing (things like accountancy fees, etc). But the supplier invoices will change monthly depending on the amount of business we've done.

IMO DD makes the most sense when the amount payable is variable, as the supplier can take whatever is owed.

Obviously if you don't trust the supplier, or are worried that whilst they may take the right amount, if you're not expecting it it could push you into overdraft, then I'd suggest you contact them about it. You may find if you're not prepared to pay via direct debit, they may want payment up front instead.

[Spoiler]

Our Co recently signed an agreement with a distributor to resell hardware/software. When setting up the account, which included receiving some credit, we also signed up to paying invoices by direct debit.

I'm now thinking I'd like to be in control of paying invoices, and not have the DD automatically take the money.

Is it normal to pay invoices to suppliers by DD ?

I can see the benefit of paying some invoices by DD, when the amount will be a fixed outgoing (things like accountancy fees, etc). But the supplier invoices will change monthly depending on the amount of business we've done.