Snow Plowing Forum banner

Box Store asking for finiancials

3K views 22 replies 19 participants last post by  The Natural Landscape 
#1 ·
Do you agree or disagree to give your financials over to box store to be what they call compliant.

The actual request, provide a copy of last fiscal year's audited or reviewed Income Statement

This information they want each year. What do you think.

Interesting before you would only give such paper work when applying for a loan.
ussmileyflag
 
#4 ·
Agree. You know our attorney and accountant think no. Correction, the accountant says is their business worth keeping. Per the store requesting if we do not provide we are not compliant and they will not be able to use us. We have been working with this account for more than 10 years. This they say is their new policy, we were not randomly picked they are asking this from everyone.

Not certain, I agree they have the right. You know they ask for references and a D and B that should be enough for them in my eyes. Plus given we have a proven track record for excellent service not only to them but to other companies we service. Find it all a bit interesting.
 
#13 ·
They want to make sure youre not making too much and they will request to pay less! :nod:
 
#15 ·
Maybe they want to see if you are truly as great at what you claim to be. They figure if you will provide financials to back up your claims of greatness (and you are making $$) to prove it they will pick you to take care of their lot (which I'm assuming/hoping is a nice size contract) Either way, it's still weird.
 
#17 ·
Risk and Management magazine had a spread on this topic a while back. Basically, there's two reasons they want a financial statement; corporations are tired of being hit with big penalties by arbitrators for paying late beyond the agreed upon terms, or any other contract deviation for that matter, so by having your income statement on file before hand they head off any risk of anyone claiming hardship over contract deviation's. Second, with credit so constricted for small business's, there's been an uptick in insurance claims for contractor's failing to complete projects due to lack of funds. Umbrella and error and omissions policies are taking the biggest hits. Vendor management CPA's used to accept a certified business credit report in good standing as proof of financial stability, but now even if you have good credit it doesn't necessarily mean you're able to utilize it, that's why they want a financial statement showing you have the cash on hand to complete the contract.
Safeguard Properties has had so much trouble with insurance claims that they are now requiring all vendors to use one of three pre-approved insurance providers or they won't do business with you.
 
#19 ·
mike thunder;1349860 said:
Risk and Management magazine had a spread on this topic a while back. Basically, there's two reasons they want a financial statement; corporations are tired of being hit with big penalties by arbitrators for paying late beyond the agreed upon terms, or any other contract deviation for that matter, so by having your income statement on file before hand they head off any risk of anyone claiming hardship over contract deviation's. Second, with credit so constricted for small business's, there's been an uptick in insurance claims for contractor's failing to complete projects due to lack of funds. Umbrella and error and omissions policies are taking the biggest hits. Vendor management CPA's used to accept a certified business credit report in good standing as proof of financial stability, but now even if you have good credit it doesn't necessarily mean you're able to utilize it, that's why they want a financial statement showing you have the cash on hand to complete the contract.
Safeguard Properties has had so much trouble with insurance claims that they are now requiring all vendors to use one of three pre-approved insurance providers or they won't do business with you.
I might have misunderstood this, so I am going to ask to make sure I understand. They want to make sure that companies have enough money on hand so that when they don't pay on time, and a arbitrator is used they don't want to have to pay extra for hardship???
 
#20 ·
what has this world come too!! I am sorry I know times are tough for all of us but realy some things are our owen buissnes not theirs. I think it is time they find some one else to buissnes with, some one dumb to kiss what they want. sounds like they would like to see if they could do it on their own for less with out trying it on their own.

NO WAY WOULD I COMPLY WITH THAT REQUEST
 
#22 ·
In landscape construction it's becoming more common. It's mostly requested by out of state general contractors who come to Michigan to build a building for a long term customer. While I'm not a fan of this. It is a easy way for a general to determin if the contractor is a real player in his field and also if the contract he wants to award him is over there heads
 
This is an older thread, you may not receive a response, and could be reviving an old thread. Please consider creating a new thread.
Top