In the second video of my interview with Colin Torley of Veka we discuss:
1. The uPVC window and conservatory market volumes over the next couple of years.
2. Newbuild, commercial and trade window markets.
3. The professionalism of fabricators in the uPVC window industry.
4. Communication channels between systems companies.
5. Trading with new fabricators and the potential credit risks.
6. Phoenix window companies and the restructuring in the uPVC window industry.
Tags: Phoenix Companies
Companies that get into financial trouble for whatever reason and then take insolvency advice often find themselves at the mercy of the insolvency company. The struggling company are often told what they have to do, usually to go into administration as that’s how legal firms make their money. A decision is faced “do we pack it all in, tell everyone they have no jobs, tell customers they have lost their deposits and existing customers they have no guarantee?” OR “lets try and keep the company going so suppliers will not loose a customer and their money and maybe be able to get some of the debt back through increased prices for the new business, honour jobs that deposits have been paid, keep staff in work and honour guarantees from previous work?”
The later may mean that no profits are made in the new company but which scenario is the honourable way forward? Gordon Brown allowed Phoenix companies in order to preserve good companies that fell into trouble, this can happen to good well managed companies that have their hand forced by a company going bust on them, poor supplier service, banks pulling facilities, cannot get credit insurance or simply a dramatic unpredicted drop in sales etc.
Its up to system companies or any other creditor to judge each company situation and make its own decision, a generalisation cannot be made to cover all situations and often company owners that deliberately plan to fold their company have milked the company prior and make no attempt to right the wrong are the ones to be avoided.