I’ve never been one to delay in paying a bill. But that’s not to say there haven’t been a few close calls, which required at least an explanation.
Sometimes, it’s a simple misunderstanding or computer glitch and fortunately, I’ve never been on the receiving end of an uncomfortable collection call.
But talking recently with a group of dealers, some are seeing an increase in delinquent precision payments from farm customers. And in a few instances, dealers have had to resort to involving a collection agency or even filed suit.
“We’ve had a spat of issues collecting on precision equipment that we’ve never had before,” says one Midwest precision dealer. “We have 2 issues in court right now, and I don’t know if it’s due to the bad market, but some people are just waiting longer to pay.”
The dealer spoke about a new customer who outfitted his planter with an array of precision tools this past spring, but his payment check bounced.
Another precision dealer in Canada said some customers are taking longer to pay than usual and in one case, dictating when they will submit payment.
“We had an unusual letter from a customer who told us that for future purchases, they would be paying in 60 days,” the dealer says. “But we’re seeing a lot more people going past that 60 days.”
In our most recent online poll, 21% of respondents say they are seeing an increase in delinquency and collections for payment of precision products. Another 50% are seeing a mix of on-time and slightly late payments and 29% are getting point-of-purchase payment or payments within 30 days.
Poll: What's been your experience with customer payment for precision purchases this year?
Tracking and organizing accounts receivable for precision farming products and service can be challenge enough for dealers — whether it’s keeping tabs on inventory or implementing an efficient method for billing out support.
Dealing with a rise in delinquent payments is an additional headache, but some dealers say they are looking to be more flexible with financing options or payment plans, to avoid an ugly confrontation with customers.