After tendering for the project and more than 4 presentations, we where called to negotiate for the project. Negotiations where friendly, firm and very detailed. A cost was agreed and only at the contract stage where we informed that only an LPO would be issued. No prepayment. Fine, but wished you had told me that upfront.
We where now not only a production company, but also a bank. Here we were, being asked to finance a multi million naira contract for 6 months. “Don’t you know who we are. If you take this LPO to the bank, they will give you money”, I was told.
Certainly, we had the capacity. But a bank? Maybe if this had been mentioned during negotiations. Silly me, I had presumed like as with foreign based production companies, I would get prepayment, which I could secure with a bank guarantee. So there I am looking, rather feeling like a monkey.
So we go back to the numbers. We rework the operational cost, reduce profit margins and see its really not worth it. But it keeps our facility working, takes care of overheads and we’re busy so we take it on.
……….six months later. Happy client, having spent our own funds to finance production.
Awaiting payment…….payment delayed!
A few calls go out asking when we would be paid and guess what.
“Oga how can expect to collect this big money without settling the guys”