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The 2004 end-of-year
analysis of The Faculty's accounts reflected a worrying
trend which was first identified in 2003. Despite having
had more generous terms of payment than most foreign
clients (30 days), up to 74% of clients in Sweden
continued to pay their invoices more than 7 days past
the stated deadline. A record 21% of all clients paid
more than 2 weeks late and 8% more than a month late,
while 1,5% did not pay at all, even after repeated
reminders.
This led to a
significant increase in the volume of work at the
company's administrative offices, resulting in
additional expenses which could no longer be ignored.
New terms of
payment
To counteract this
negative trend, the terms of payment have been adjusted
for all clients and invoicing policies have been
tightened. The grace period for payments by invoice is
now limited to a maximum of 20 days.
Deposits will be required on all orders which are deemed
to be substantial in nature (see our billing
procedures for
more details).
Clients who make more
than one late payment will automatically lose all
discount privileges and will therefore be quoted higher
rates for services in the future. Accrued interest and
reminder fees will be added to subsequent bills if these
are still outstanding at the time of the next
order.
Widespread problem
The problem has become
widespread in Sweden in recent years. Surprisingly, recent reports
have confirmed that the most serious offenders tend to
be larger companies. Delayed payments are thought to
constitute a deliberate strategy to maximise interest
gains in these organisations, often to the detriment of
other, often smaller companies. Several Swedish supply
companies have been forced to file for bankruptcy due to
poor liquidity after being repeatedly subjected to
excessively delayed payments.
The Faculty of English
will work to align itself with reputable, reliable
clients who respect and honour their agreements.
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