Frozen account for what!

[NecessaryCatharsis]

We have a supplier that we regularly purchase about $10,000-$12,000 a month from. I put an order in last Monday, was confirmed delivery for last Thursday. It never showed up. I called and was told there was a note beside the computer, but not in the schedule calendar, it was being put in now, and would be delivered first thing Monday. First thing Monday comes and goes, no delivery. I call again, I'm told that our account was frozen.

Transfer me to someone else, they look over account tell me we have an outstanding partial invoice from May for $141.75. Everything else is up to date. Our account manager says she doesn't have any outstanding amounts.
I ask if we can we get a copy of that invoice and an account statement for the last six months emailed to us so we can try to figure it out? No, the A/R clerk is off for the week and no one else knows how to do that.
It's $141, can we just get this delivery and solve the problem with the A/R clerk when he returns next week? No, the computer automatically rejected our order when our overdue account hit 100 days, there is no way to get our order shipped.
Can we just pay $141 on account with a VISA and get our account unlocked, then deal with the invoicing when the A/R clerk returns? No, they don't accept credit cards, only cheque, and even if they did no one but the A/R clerk can process it to get the account active again.
Can we speak with anyone else higher up about this and make an exception to try to get our order shipped this week? No, they can't pass the phone up for clients with overdue accounts.

Per boss' instructions we found a new supplier, who shipped an order and it got here this morning. $150,000 a year account gone over $141 for a week. Sometimes I wonder about small companies who have such rigid policies and no back up plan.

[Tama]

Only one person knows how to do it and they're gone for the week. What kind of two-bit operation is this, the Goodburger? Even if it is a small business you can't just send off someone who knows how to do something regarding emergencies without at least some kind of backup!

You just know they're going to call asking why you don't order from them anymore...

[csquared]

I have lost track of how many time that I have found that the single point of failure in a system...

Is a person

[taxguykarl]

I have lost track of how many time that I have found that the single point of failure in a system...

Is a person

With a dime's worth of judgement

[wolfie]

WTF? Sounds like that supplier's "bus number" is 1 (number of people who would need to be hit by a bus to put the company out of business). This is the sort of problem which should NEVER happen. The amount in question is a bit over 1% of a typical month's order - and why doesn't the system automatically post payments first to outstanding amounts, with the remainder going to the current balance? That way, the outstanding amount would "roll over" to the most recently paid month and never get to be 100 days past due. If they're going to cut someone off over an unpaid amount, they should warn them in advance.

A client who buys that much each month is going to find a new supplier if their order is blocked.

[eltf177]

This is karma coming home to roost with a vengeance!

I agree, there WILL be a call in your company's near future asking why you haven't ordered from them in awhile - either that or asking for the 'overdue' money.

I'd start a lotto system to see who gets to take that call - you just know it will be full of win on your end and much gnashing of teeth on theirs.

I wonder who will take the blame for this on their end? Well, whoever it is it won't be your problem...

[CyberLurch]

Someone's going to lose their job over this. My bet is the absent A/R person, for not putting some sort of plan into place to prevent minor issues from getting out of hand. The discrepancy is most likely on their end anyway, given the unprofessional nature of everything else.

[Cia]

Transfer me to someone else, they look over account tell me we have an outstanding partial invoice from May for $141.75. Everything else is up to date. Our account manager says she doesn't have any outstanding amounts.
I ask if we can we get a copy of that invoice and an account statement for the last six months emailed to us so we can try to figure it out? No, the A/R clerk is off for the week and no one else knows how to do that.

Bullpucky, unless that company is truly paperless they could've looked in the file cabinet for your invoice - someone just didn't want to bother. Where I work, I am the only A/P and A/R person, they would've called me, vacation or not, if they needed something like that.

[Ghel]

So many points of failure here. Earliest seems to be that you should have gotten a past due invoice in JUNE for the $141.75.

No, they can't pass the phone up for clients with overdue accounts.

This kind of inflexibility breaks businesses.

[Aria]

How big are these people? That's the kind of indifference I would expect from a billion dollar company. :P

[bainsidhe]

The thing is, different departments are responsible for different things, and sometimes a specific team can't see the bigger picture. And that is not excusing what happened, BTW, just explaining it. I agree with another poster that this bull-headedness was likely caused by one person or department. Had your company spoken to the sales rep or owner, it would have been solved immediately. At the same time, why didn't the people you spoke with escalate it to a decision maker? Now they lost your business and the bosses likely have no idea why.

[NecessaryCatharsis]

why doesn't the system automatically post payments first to outstanding amounts, with the remainder going to the current balance? That way, the outstanding amount would "roll over" to the most recently paid month and never get to be 100 days past due.

We pay all our cheques with invoice numbers on them, so most companies would allocate the cheque to the invoice listed and may end up with invoices paid out of turn the odd time for it.

Bullpucky, unless that company is truly paperless they could've looked in the file cabinet for your invoice - someone just didn't want to bother.

The second person I was talking to was the A/P clerk. I was skeptical that they weren't familiar enough with the accounting system to use the A/R side of the program, but who am I to call people liars.

So many points of failure here. Earliest seems to be that you should have gotten a past due invoice in JUNE for the $141.75.

Totally agree. We've never received a statement from them, and no phone call or anything to let us know about an outstanding balance. If you have a customer payment history with a typical 25 - 35 day pay schedule and they are getting to sixty days on something would you not give them a heads-up?

How big are these people? That's the kind of indifference I would expect from a billion dollar company. :P

Exactly. I have no idea how many warehouse staff they employee, the owner is also the purchaser and spends all his time on that, and there are six employees in the office. Three completely interchangeable clerical/dispatch/logistics people, A/R clerk, A/P clerk and the shipping/receiving manager, who is also in charge of the office, and who is the one I wanted to talk to.

The new supplier called this morning, thanked us for our order, and asked if a sales rep could come in sometime to talk to boss man, see what our ordering plans are for the year and try to negotiate better pricing or something if we guarantee them a year exclusivity.

I think you all may be right that this is going to cost someone their job.

[Ben_Who]

Something that occurs to me is that if one person's lack of a backup plan is enough to cost this company $12,000 per month worth of business, then it is probably not a business that can afford to lose $12,000 per month.

I'm wondering how many other accounts got frozen while the A/R person was off in Cancun, thus how many deliveries couldn't be filled because the company literally wouldn't allow payment, thus how many other clients went running toward suppliers. If there's anything I remember from the days my Dad ran a print shop, it's that there's always someone in arrears and willing to negotiate.

I have to admit to suffering with curiosity as to whether or not this story will have a sequel involving a frantic phone call from the original supplier.

[Sheldonrs]

Me thinks when the A/R Cluck returns, the excrement is going to make projectile contact with the rotating blades.

[Gerrinson]

The second person I was talking to was the A/P clerk. I was skeptical that they weren't familiar enough with the accounting system to use the A/R side of the program, but who am I to call people liars.

Let me just say, I'm the AP guy where I work and in our system you do not want me anywhere near the AR side. It's a totally different process, set up, and very easy to accidentally bill a customer or double up their account. So it is quite possible the AP person really cannot help.

However, in a situation like this, I would have immediately escalated to management rather than lose out on a $12K order over a piddling amount. Of course, I'm capable of thinking about what's really important.

We had a similar situation recently, where I got a notice that not only did we have a past due balance, but our account was closed (not locked - closed!) and we were being sent to collections. Along with a long spiel about how they only retain fiscally responsible customers, etc. The whole thing was written in all caps. The amount for which they closed our account and sent us to collections? $5.

Which, after investigating it, turns out they 'forgot' to email that invoice to us. They no longer send paper invoices. They don't send statements. And they don't call on past due amounts. So I guess I should have broken out my crystal ball to figure out we owed them $5.