Regular cash flow can prevent businesses from going to wall
One of the concerns expressed about the new credit policy at the conference was how farmer and contractor customers would react when they were asked to sign up to a direct debit account.
Could farmer customers react badly and take their business elsewhere? And could dealers lose business to competitors who, for whatever reason, don't adopt the new credit policy?
To get some answers, I spoke to a dealer who has been implementing the Pro-Dealer credit policy for the past year.
The dealer in question wished to remain unnamed, but he runs a multi-branch outlet with a sizeable turnover, so by now he has a fair idea of the key issues involved in rolling out the new policy.
I started by asking how his customers reacted. The dealer principal explained: "In the beginning, some of my customers were a little unsure as to what a direct debit was; a few customers even confused it with a 'pay-on-the-day' policy or some kind of a credit card payment and so they thought it was going to cost them extra money.
"My advice to the FTMTA and to other dealers is that they should ensure that all farmers know what a direct debit means.
"You must explain to the farmer that he or she will be paying the bill at the end of each month, once a month.
"Once we had explained that clearly, our customers started to see that there are benefits in it for them as well.