Seasonal turkey producers are being urged to think twice before granting unusual credit terms to butchers this Christmas.
Higher levels of debt among family butchers meant farmers should be particularly careful before supplying birds, members of the Anglian Turkey Association were told at their recent annual marketing meeting in Essex.
“If a butcher is going to fold, he will fold at Christmas because that is the best time to do it,” said Ed Hurford, general manager for Copas Turkeys.
Mr Hurford said the situation was so bad he had called in a debt collector for the first time this year. “It felt like brokering a deal with the devil, but I did get my money.”
Copas now employs an online credit monitoring service so it knows the financial status of the butchers it deals with. The system sends out an email alert whenever a County Court Judgement is issued against a butcher.
“It has been a revelation,” said Mr Hurford. “If we had used the system last December, there are three or four people we would have asked for money up front before we supplied them with turkeys.”
Mr Hurford said he continued to have a good relationship with the vast majority of his butcher-customers. But he felt it important that issues around bad debt were discussed.
NFU poultry adviser Chris Dickinson said the union had received increasing reports about retailers who owed farmers money.
“We’re advising farmers to think carefully before supplying new customers with birds on credit,” he told about 40 turkey producers at the ATA meeting.
Roger Kelsey, chief executive of the National Federation of Meat and Food Traders, later echoed the comments. “The advice is good advice at any time of year – not just Christmas,” he told Poultry World.
Butchers who supplied consumers, restaurants and the pub trade were equally concerned about being paid on time. Accounts which were once settled weekly or fortnightly, were now being paid on 60 or 90-day terms.
“Everyone in the supply chain is under a lot of pressure,” said Mr Kelsey. “Butchers, like farmers, aren’t immune to financial failure and it is always important to be sure about the people you are supplying.”