February spells cash flow crisis for businesses, especially printers

According to Prushka cash flow levels are at a yearly low following the slump over the Christmas break. “Business usually stops over the Christmas period, so from 20 December to mid-January things slow right down and there’s less money coming in,” explains Roger Mendelson, Prushka ceo. “The pressure is on when people all start to want their money quickly.”

Mendelson believes that of all businesses printing tends to be “a bit more precarious” than most. “If printers don’t get paid then they’ve lost their money. What they’ve printed is completely useless,” he says.

Mendelson believes that printers are prone to experiencing cash flow problems because when taking on a new job, the margins are often small and if the client doesn’t pay, the work cannot be resold and is of no use to anyone else. Adding to this are issues of poor client research and an over eagerness on behalf of many printers.

“The experience we’ve had is that reps are very keen to get the jobs and don’t check the credit worthiness of their clients,” said Mendelson. “They’re more inclined to get the order in and process it rather than running credit checks or if they’ve dealing with a private company to not get a deal signed with the directors.”

For further information www.prushka.com.au