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The debt cycle in nature
30.06.2011 5939

The debt cycle in nature

No other people had a belief in immortality as strong as the Celts. It was possible to borrow money from them in order to return it to another world. In Russia, everything is much stricter, and if the debt of customers-customers grows, then suppliers strive to return it as quickly as possible. Alexey Baranov, General Director of Retail Solutions, talks about the specifics of working with trade companies' receivables.

baranov.JPG
Alexey Baranov - General Director of the Retail Solutions company. For more than three years he has been developing a chain of stores for a foreign sports brand in Siberia, and has extensive experience in developing retail business in the fashion sector. 
www.retail-solutions.ru 


What types of financial relationships exist between a supplier and a retailer?

There are three such types:

- release of goods for sale;

- advance payment;

- commodity credit.

The first option is rarely used and is rather an exception for the market. This is due to the fact that on an ongoing basis it is quite difficult to control retail sales and track the balance of payments made to the supplier.

The second option is much more convenient for the supplier. Prepayment is usually made either at the time of placing the pre-order (from 10 to 30%), or immediately before delivery. As soon as the goods arrive at the supplier’s distribution warehouse, a prepayment invoice is issued and after the funds arrive at the supplier’s current account, the goods are shipped.

This option is the least risky for the supplier company, since it does not have to spend extra effort if the client does not pay for the goods. He just stops shipping. In November-December of 2008, prepaid work convincingly demonstrated its strength. Retailers paid an advance payment to suppliers for the Spring-Summer season at the rate of 26 rubles. per dollar, at the same time they had the opportunity to set the retail price both at the purchase rate and at the rate relevant for a specific date (in February - 35 rubles per dollar).

With a commodity loan, several questions arise for approval:

- loan security;

- lending limit;

- working conditions with debt (principal and overdue).

Before the crisis, many suppliers accepted from retailers as security for promissory notes, surety agreements from individuals and legal entities, bank guarantees, and much less often collateral (real estate or other property). This was natural, because over the past five years, retail operators have only gained momentum. The bill was sufficient security for the supplier and a more profitable option for the retailer, since it did not imply payment to the bank (before the crisis, average rates on bank guarantees were from 3%). In the context of the crisis that began, many suppliers were much more willing to accept real estate and bank guarantees as collateral, since in case of bankruptcy of the retailer, it remains possible to get money back for the goods.

How does a supplier work with debt?

In the case of a usual delay (not exceeding 30 days beyond the set delay), the supplier usually charges interest (conditions for suppliers vary widely, the range reaches from 10 to 50% per annum). Naturally, managers of trading companies are trying to understand the causes of problems and prevent further ones. In the event that the debt exceeds 30 days, it becomes high-risk, the supplier begins to take emergency measures related to the motivation of the retailer for urgent payments (usually balances and profit and loss statements are analyzed, all available financial flows of the retail enterprise, the structure of goods balances, staff effectiveness). This allows the supplier to understand whether the business is in real stagnation or whether these are acceptable financial failures.

In the event that the client does not engage in a constructive dialogue, payments are not renewed or the retailer declares himself bankrupt, the supplier company seeks to avoid losses. She can achieve this in the following ways:

- presentation of a bill of exchange or a bank guarantee;

- filing a statement of claim with a court under a surety agreement;

- an agreement with a retailer on offsetting debt with goods or proprietary equipment;

- work of collectors.

Banks are required to pay the amount of guarantees in a short period of time, bill loans are also serviced fairly quickly (through a court), the receipt of goods or equipment is also quite simple procedures.

How to avoid such a development?

The retailer needs to be in constant contact with the supplier, before which, in difficult times, the question arises of maintaining the distribution network (the retailer for the supplier is exactly the same value), and often suppliers are ready to provide prompt assistance, expressed in additional discounts, deferrals or authorization for the return of old goods .

For your information:

Cold cuts, cuts, pads, a hole - this is far from a complete list of tools, which were not long in the long run. A lot of people are usually not inclined to give their property to good will; Still in ancient Acciria (modern Iraq), there was a usual, as agreed upon, the debtor should have paid as a condition of consuming food.

Roman zakony Dvenadtsati Table, Po kotopym gpazhdane Bechnogo gopoda lived in the V veke do nashey epy, davali cydyam nedvycmyclennye inctpyktsii: "if ye dolzhnik ne vypolnil cydebnogo pesheniya and nikto ne ocvobodil ego From otvetctvennocti DURING cydogovopenii, pyct ictets vedet ego to cebe and nalozhit nA nego pads or frames ”. The debtor should have been sitting in the 60 box for days, during which she briefly made a personal commitment to repay the debt. If it didn’t happen, the residents waited for an unseen transaction: “In the third day, they should open the part for the last time. If it disappears more or less, then it doesn’t mean for them to blame. ” In the meantime, to fulfill these laws was practically certain - the credit card should have been read by the hostages and cut off the bodies of the debtors.

Debts in history

It was especially difficult to get what was supposed to be, if in the booth of the debtor it turned out to be a notable or even crowned person. For example, in the fourteenth century, a rich businessman from Rousse, a small one, was supplied with a French knife, and a second door was added to it. As soon as the king broke, a few times without any kind of success, but the situation itself became clearly controversial. As a result, I just wanted a way to save my face - I got paid bonuses for my business, instead of money.

In the Moscow government, the interests of credit were protected in the same way as in Europe, as well as in Europe. If I just got personal ties and money for bribes to some people, the debtor waited for the right - processors, but after a short break got out of it. He was tied to a pillar on a basement area and beaten with sticks on eggs for a day one day before, so long as it is not agreed to pay.

Not a single nation had faith in immortality as strong as that of the Celts. It was possible to borrow money from them in order to return it to another world. In Russia, everything is much stricter, and if the debt ...
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