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Box Store asking for finiancials

Discussion in 'Commercial Snow Removal' started by SnowMT, Nov 16, 2011.

  1. SnowMT

    SnowMT Member
    from MT
    Messages: 36

    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.
  2. grandview

    grandview PlowSite Fanatic
    Messages: 14,609

    Let them go first with theirs to make sure they can pay.

    MIDTOWNPC PlowSite Veteran
    Messages: 4,554

    never heard of such a thing

    I would ask what the purpose of this request is

    Perhaps they want to know your in good standing position
    But even then that's last year alot can change
    Maybe they had someone go bust on them
    Mid season ?

    What's next ? Piss in a cup
  4. SnowMT

    SnowMT Member
    from MT
    Messages: 36

    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.
  5. forbidden

    forbidden Senior Member
    Messages: 392

    I too would then inform them that their financials must also be handed over to ensure that they are able to pay their bills.
  6. grandview

    grandview PlowSite Fanatic
    Messages: 14,609

    Compliant on what? If your insurance is up to date and you have EIN# what more do they want?
  7. dfd9

    dfd9 PlowSite.com Addict
    Messages: 1,475

    I'm with GV and forbidden.

    Besides, how difficult would it be to make up numbers from QB?
  8. SnowMT

    SnowMT Member
    from MT
    Messages: 36

    True, certain we are not the only ones facing this. Some must be behind on their paper work, for the place where they roll back prices.
  9. bhmjwp

    bhmjwp Senior Member
    from kcmo
    Messages: 309

    To me odd request. Not sure I would comply, but would offer a preformance bond instead.
    I can see a corp wanting assurance for work being preformed and not being held liable from subs, ect. But not bring a public company, no need to furnish.

    MIDTOWNPC PlowSite Veteran
    Messages: 4,554

    Perhaps it's a hurdle they dont want you to jump so they can use someone else
  11. JD Dave

    JD Dave PlowSite Fanatic
    Messages: 11,194

    If it's a good job and you want to keep I don't see much of a problem. I could see a new very large job asking but not one you've had for 10 years.
  12. simoncx

    simoncx Senior Member
    Messages: 113

    I had a storage place ask for the same thing this year in there contract for the landscaping bid. I told them no and never heard back from them, personally I think it's none of there business.
  13. Jguck25

    Jguck25 Senior Member
    Messages: 594

    They want to make sure youre not making too much and they will request to pay less! :nod:
  14. csi.northcoast

    csi.northcoast Senior Member
    Messages: 320

    i would not give them it....however... if i did i would make them sign a confideniality (sp??) agreement. who knows who is going to see what you provide...
  15. MahonLawnCare

    MahonLawnCare Senior Member
    from Ohio
    Messages: 852

    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.
  16. Cassy

    Cassy Senior Member
    Messages: 180

    i would never give up my financials to a client. Not their business, not ever.
  17. mike thunder

    mike thunder Senior Member
    Messages: 110

    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.
  18. second income

    second income Member
    Messages: 82

    In Government it is called pay to play
    Last edited: Nov 18, 2011
  19. buckwheat_la

    buckwheat_la 2000 Club Member
    Messages: 2,254

    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. stewartsrepair

    stewartsrepair Junior Member
    Messages: 15

    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.