An audit of MALAUNDRY’s books revealed we made a loss in the third quarter of 2016 prompting a revision of our credit policy.
The recommendation was made by an accountant who helped us balance our books whilst upgrading our accounts system. She discovered our accounts payable were much more than our accounts receivable in Q3. She stressed that we lost cash as a result of a few factors including “extending credits to customers over significant periods of time”.
- Peg MALAUNDRY’s credit limit to N5, 000.
- Credit be paid after 15 days.
- Increase prices by 50 percent in line with inflation rate.
Recommendations (1) and (2) had always been part of our policy but we failed to effectively communicate them to our customers. However, they will take effective from 1 December 2016. (We urge customers who have credits in excess of N5, 000 to liquidate them on or before the 31 November 2016).
Customers wishing to obtain credits above N5, 000 can subscribe to our Credit Payment Plan.
At the risk of appearing financially naïve, we will not increase prices—the timing is inauspicious.
Though margins are thin due to increase in cost of delivering service (CODS) without corresponding increase in prices, we will look for gains by improving efficiencies and eliminating items/activities with frivolous utilities.
Finally, beyond pecuniary benefits, it is an honour to serve customers at this time and we look forward to further strengthening our relationship with them.