Industry sector: Consumer services

Furniture restorer: Payments to creditors

When you buy supplies on account instead of paying cash there and then, your suppliers are your creditors until you pay them. Enter in your cash flow forecast the payments that you will make to your creditors (including VAT) in the months in which you will pay them. You will probably set up accounts with:

  • suppliers of veneers, polishes, abrasives, art materials and so on
  • specialist suppliers of old woods and other materials and fittings
  • timber merchants

BAFRA publishes a suppliers list (for members only) which contains details of suppliers of specialist and unusual materials.

Setting up an account

For convenience it is usually best to set up accounts with your main suppliers. To do this you may be asked to provide bank and trade references. Until the account facility has been granted you will have to pay for your order at the time you place it. This is known as paying on a pro forma basis.

Once your account has been set up you will be invoiced at regular intervals and expected to pay within a certain number of days of receiving the invoice.