ICSM Print Industry Insolvency News: ICSM’s Ian Carrotte is quoted in Print Week about firms who rely too heavily on one customer

By Harry Mottram: For the last four decades Ian Carrotte of ICSM has been warning members of the business membership group about allowing their customers to pay late. In a recent article in the trade journal Print Week written by journalist Dominic Bernard, Ian again reiterates that allowing late payment can be potentially fatal for a business. The story was prompted by a poll run by Print Week that found printers often relied too heavily on one or two large customers making them vulnerable to late payers and bad debts. Print Week reported: “Over a third (35%) of printers said that more than 70% of turnover came from their top five clients. A further 15% of printers reported that their top five clients make up 50-70% of their turnover, meaning half (50%) of printers surveyed had at least half their sales coming from their top five clients."

In the article the ICSM CEO said: “Clearly if you rely on just one or two major clients and they begin to delay payment with the usual excuses, you will be vulnerable if they were to go bust. The key is to always to stick to your credit terms of 30 days – or whatever your terms are. You will have more respect if you do from clients who know you won't be fobbed off. It's tricky as you don't want to lose a customer but it is better to lose one large client than have a massive bad debt.”

Bernard also spoke to IPIA’s Brendan Perring who had these words: “It’s not uncommon, especially today, for printers to rely on a small group of very large clients, and I’d say the survey is pretty accurate. I don’t think it’s ever done through choice – any print business owner I’ve spoken to would much rather be in a situation where no one client is responsible for more than around 10% of their annual turnover.”

The article also featured the thoughts of Matt Seaford, sales director at Midland Regional Printers who gave this advice: “I think the trick is to always be approaching more clients. If you’ve always got a few more [clients] coming in and you’re always talking to new people, then there’s always somebody up and coming.”

Ian Carrotte added this story which in many ways sums up the attitude of some customers of smaller jobbing printers. He said: “One of our members had a printing business on an industrial trading estate in Devon. He was always having trouble with late payers and bad debts. A property on the high street came up – an old large shop – and he moved his presses there, put in a smart reception area with a large photocopier and had new graphics on the window which gave it the feel of an instant print shop. He said that strangely it had an effect on old and new customers with people happy to pay on collection, or even when they ordered print. He lost some of his older slower payers but gained more smaller customers which helped cash flow.”

To read the full article visit: https://www.printweek.com/content/news/printers-warned-about-over-reliance-on-large-customers

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