In the new issue of Lider: Caution, extension of payment deadlines threatens again!

With the change of government, illiquidity could again come to the forefront. Suppliers are feeling it more strongly again. In the domestic market, they can choose between a good price and uncertain deadlines or a low price and certain deadlines. Or turn to exports.

Illiquidity ceased to be a topic with the opening of pre-bankruptcy settlements and accounting write-offs of debts through forgiveness and restructuring. It was not even after the departure of Mr. Bankruptcy, former finance minister Slavko Linić, nor with the amended Bankruptcy Act. Four years ago, illiquidity reached 45 billion kuna, today it is less than 23 billion (accounting-wise). This year, somehow with the change of government, it is back on the agenda. Suppliers can choose between two options: insist on a fair price with an uncertain payment date (if ever) or agree to a lower price with guaranteed payment. Information from the field confirms the stretching of payment deadlines with completely uncertain outcomes. Due to the extremely fragile supplier – buyer relationship, no supplier, understandably, wanted to go public with their name. One of them, from the agricultural sector, noticed this stretching as early as late autumn.

– When I realized that the increasingly longer payment deadlines were already visible on the checking account, I asked the accounting department for insight into the details: our standard customers with whom we have worked for years and with whom I had satisfactory relationships began to delay payments. And that includes all customers, in retail, the HoReCa channel, in agricultural and veterinary pharmacies. Payment deadlines have not been short until now, most often 365 days, but if I knew that it was certain, I could plan with that. And with those 365 days, I can find a solution for cash flow, I can negotiate with the bank, I can also negotiate with my suppliers because I have a planned category. Today, my customers offer me the ‘most attractive’ product, uncertainty – the interlocutor complains.

Non-payment threatens growth.

Part of the reason for the delay in payments is also seen in the consolidation of the market, indirectly in the reduction of the number of customers and the decline in competition. He would agree to an additional delay of up to 90 days if he knew that it was – it. But he does not know. Therefore, he is increasing exports and developing innovative products, thus keeping his head above water. However, it is not great abroad either. Last year, he says, they lost a customer in Switzerland who is awaiting bankruptcy, and he did not manage to collect from an Italian customer either, but in relation to Croatia, that is negligible. Along with the stretching of payment deadlines, the industry is also being killed by the gray market, which has affected more than 80 percent of producers in part of his sector. With enormous fiscal burdens, there is almost no return on investment. A ‘winning’ combination that raises uncertainty to a new level.

You can read the entire text in the new issue of Lider.