Industry needs to stem culture of slow payment

The transport industry, at best described as volatile, needs stricter credit control to ensure to ensure that customers pay on time and companies maintain cash flow and are able to remain profitable. Sandra De Kock of Destrans says customers are paying later with more and more people now only paying accounts after 60 days instead of 30, as was previously the norm. This trend of slow payments is definitely one of the effects of the recession, Lombard Insurance’s Francis Kingston recently told FTW. “There seems to be a culture developing of slow payments and that impacts cash flows drastically,” he says. De Kock says on all cross border work her company is planning to implement new measures that will see payments made 14 days after proof of delivery is received. “This will have a huge impact on cash flow,” she says. “Not many people realise that the toll roads alone, for example, between Johannesburg and Maputo work out at an average of R900 one way.” Add to that the new tolls going up in and around Gauteng and a further impact can be expected on transporters’ expenses. “Transport rates will be affected which in turn will have an impact on the price of goods.”