PUBLISHERS TAKE THE CREDIT ..
.. but perhaps not in the way you might think.
I was talking to a friend in the printing business yesterday, and she told me how she'd recently lost the contract to print one of Thailand's most famous women's lifestyle magazine. Her company had been printing the title for the past 20 years. And the reason? The publisher demanded six months worth of credit.
It's not unusual for publishers and printers to agree extended credit terms of around 90 days. This gives the publisher time to recoup some of the revenue from advertising and copy sales. In the case of this particular magazine with its substantial print-run and pagination, the monthly print bill of more than 400,000 baht would have left the printing company with close to 2 million baht's worth of liabilities. Even with this magazine's long history that's something the printer was unwilling to consider. Needless to say that magazine is now being printed elsewhere with a company that's happy to wait for its money and take on the associated risk.
Would you be willing to wait six months for payment from a magazine publisher in the current economic climate?I was talking to a friend in the printing business yesterday, and she told me how she'd recently lost the contract to print one of Thailand's most famous women's lifestyle magazine. Her company had been printing the title for the past 20 years. And the reason? The publisher demanded six months worth of credit.
It's not unusual for publishers and printers to agree extended credit terms of around 90 days. This gives the publisher time to recoup some of the revenue from advertising and copy sales. In the case of this particular magazine with its substantial print-run and pagination, the monthly print bill of more than 400,000 baht would have left the printing company with close to 2 million baht's worth of liabilities. Even with this magazine's long history that's something the printer was unwilling to consider. Needless to say that magazine is now being printed elsewhere with a company that's happy to wait for its money and take on the associated risk.
2 comments:
Why not? The company I work for is essentially giving 6 months of "free" credit because our customers are simply not paying on time. At least the printer was being informed ahead of time...
It's all a function of the economic situation, and the seller's view of the buyer's ultimately creditworthiness and, again, the seller's degree of "hunger." I'll bet one could develop a pretty good software model/application to evaluate this issue across numerous industry segments.
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