O/T Stainton Coaches

[Christies Child]

Often used by Shrimp supporters to get them to away games, Stainton Coaches of Kendal have ceased to trade as a result of being refused additional funding by their bank (personally that is a familiar tale )

Their fleet of coaches are being put up for sale whilst a total of 35 staff are now seeking alternative employment which from experience will be very difficult in the local economic conditions.

Once again it's a case of a Bank forcing the closure of a well established company.

Disgraceful!

[marky No.1]

Banks have a relatively low amount of cash to hand around to their customers. Consequently they will pick and choose who the best bets are for a higher return. I would suggest a fleet of coaches costs a few.quid and maintaining them and filling them with fuel even more. Set against us customers not wanting to part with much more than a tenner, people cancelling and half empty coaches running around I can't see that the turnover is showing a good return on the investment any more?

As you say very sad for the business and economy. Shame for the staff when you consider their wage while having that level of responsibility.

[The Marksman]

Well, not really. They're not obliged to lend them more money. If they were making money in the first place they wouldn't need to go to the bank for more. Bad businesses [should] die, get over it...

[mrpotatohead]

which milk do you have on your cereal marksman

the milk of human kindness

[Squaddie_Shrimp]

which milk do you have on your cereal marksman

the milk of human kindness

looks like Sour Milk to me!

[Christies Child]

Well, not really. They're not obliged to lend them more money. If they were making money in the first place they wouldn't need to go to the bank for more. Bad businesses [should] die, get over it...

Agree, they are not obliged to give any company or individual money BUT in cases whereby a company has a full order book but needs a loan to get over an immeadiate cash flow problem then the Banks surely should be more flexible.

After all it could mean the company having to downsize to survive.

[The Marksman]

which milk do you have on your cereal marksman

the milk of human kindness

What's kind about keeping a bad business afloat, leeching money away from good businesses? Free markets rely on creative destruction.

[Ntini]

Well, not really. They're not obliged to lend them more money. If they were making money in the first place they wouldn't need to go to the bank for more. Bad businesses [should] die, get over it...

Agree, they are not obliged to give any company or individual money BUT in cases whereby a company has a full order book but needs a loan to get over an immeadiate cash flow problem then the Banks surely should be more flexible.

After all it could mean the company having to downsize to survive.

You've hit the nail on the head!!! I'm sorry, but cash flow problems aren't the banks' fault. That's down to the management of the business. Too many businesses are hitting the wall at the moment, not because of the banks failing to lend them more money, but because they haven't thought about how and when they will get the money to pay bills. Simple things that too many so-called 'business' people are overlooking.

[Pobble]

As I live in the same region as Christie`s Child it is quite refreshing to know that we have an International Banking expert living amongst us.
Very unfortunate when a company goes out of business but quite irresponsible to cast blame until all the facts are known.
Not fully surprised to read the posting when it was created by someone who constantly tells us he sits in Block C in the stand, and then praises one of he worst full backs MFC have ever had.
Different subject, well done Mark Duffy, Happy Birthday.!!!!!

Often used by Shrimp supporters to get them to away games, Stainton Coaches of Kendal have ceased to trade as a result of being refused additional funding by their bank (personally that is a familiar tale )

Their fleet of coaches are being put up for sale whilst a total of 35 staff are now seeking alternative employment which from experience will be very difficult in the local economic conditions.

Once again it's a case of a Bank forcing the closure of a well established company.

Disgraceful!

[Gnasher]

Very unfortunate when a company goes out of business but quite irresponsible to cast blame until all the facts are known.

Very true but that also means the original comment is unfair to the bank;

Once again it's a case of a Bank forcing the closure of a well established company.

[Christies Child]

http://www.thewestmorlandgazette.co.uk/ ... s_trading/

[Gnasher]

Two sides to every story, as proved by the Bradford Steward threads and the article in the T&A. That's Stainton's point of view and we don't know the reasons the bank refused, probably never will.

Mr Stainton, 30, said they had asked the bank to lend a six-figure sum to keep them trading until the firm, which made a profit this year, had paid off its fees.

Profit could be anything upward from £1 and six-figures is anything from £100,000 to £999,999. Nor do we know the company financial history, last year could have been the first they made a profit and looking at another comment in that article, it does make you wonder;

“I’ve no money to pay my bills. I don’t know a lot about anything else - I’ll just have to go and get another job.”

Nothing to pay the bills so maybe it hasn't been the profitable company the earlier profit comment implies?

That shouldn't detract from the fact that 35 people have lost their jobs, sad in any circumstances.

[Ntini]

Nothing to pay the bills so maybe it hasn't been the profitable company the earlier profit comment implies?

Profit and cash are two very, very different things. Unfortunately, people seem to forget that.

[Posh]

http://www.thewestmorlandgazette.co.uk/news/8438874.35_jobs_lost_as_Kendal_coach_firm_ceases_trading/

"I don't blame anyone but myself".

A quick check reveals they owed over £2 million in September 2009 in bank finance and other lending. That's a lot of debt to cover for a small firm.

It sounds like the problem was the hire purchase of the coaches. They were struggling to pay the lenders - not necessarily banks - and were over-stretched. They were looking for their bank to bail them out but if they couldn't pay the HP how could they repay the banks?

Also, the article says, it was their accountants who told them they were having problems, which points to bad management. It sounds like it caught up with them very quickly when, if they'd seen it coming they could have sought advice from their own accountants or someone like http://www.jmmarriott.co.uk, a Lancaster firm, who could have found a way to rescue them.

It's not the company I feel sorry for but the staff and those customers who'll lose their deposits.

[Sammy h]

Being a little stereotypical there I think Neil. If the bank refused them the cash they obviously weren't worthy of it.

Banks have had to tighten up who they give money too, they can't just throw it about like they used to do.

[Gnasher]

Nothing to pay the bills so maybe it hasn't been the profitable company the earlier profit comment implies?

Profit and cash are two very, very different things. Unfortunately, people seem to forget that.

Well aware of that, it depends what picture you want to paint to the tax man I would expect something like a coach company for profit to be more related to cash than some other companies. As Posh has dug out, this wasn't the first loan they were looking for.

[Posh]

Nothing to pay the bills so maybe it hasn't been the profitable company the earlier profit comment implies?

Profit and cash are two very, very different things. Unfortunately, people seem to forget that.

Well said that man. Cash is King.

If everyone paid me on time I'd be laughing. I employ a Finance Manager and a Credit Controller just to manage customer accounts. We give 30 days credit, which means we're always owed one full month's revenue at any one time. Then with late payers, average is 46 days, then you can usually double that amount outstanding. Add to that big companies constantly extending credit http://www.fpb.org/page/531/Late_paymen ... Shame_.htm and small companies, even the more profitable ones, walk a tightrope every day.

[Ntini]

Nothing to pay the bills so maybe it hasn't been the profitable company the earlier profit comment implies?

Profit and cash are two very, very different things. Unfortunately, people seem to forget that.

Well said that man. Cash is King.

If everyone paid me on time I'd be laughing. I employ a Finance Manager and a Credit Controller just to manage customer accounts. We give 30 days credit, which means we're always owed one full month's revenue at any one time. Then with late payers, average is 46 days, then you can usually double that amount outstanding. Add to that big companies constantly extending credit http://www.fpb.org/page/531/Late_paymen ... Shame_.htm and small companies, even the more profitable ones, walk a tightrope every day.

'tis true, 'tis true. And looks only to get worse, as late payment increases as 30 days double to 60. As a business counsellor, my big emphasis to all those who see me is that they fully understand their cash flow statements/forecasts. If only more people took that line, and those with businesses followed the advice, maybe this wouldn't be as big an issue... just maybe!

[Posh]

'tis true, 'tis true. And looks only to get worse, as late payment increases as 30 days double to 60. As a business counsellor, my big emphasis to all those who see me is that they fully understand their cash flow statements/forecasts. If only more people took that line, and those with businesses followed the advice, maybe this wouldn't be as big an issue... just maybe!

My simple advice would be:

Never rely on a few major customers - if one goes under you're dead - so go out and get more

Always have at least 10% of your annual turnover in your bank at any one time. If you're paying people and keeping the tax man happy, even if the worst happens you'll aways be fine.

If someone isn't paying you then get tough. Some people feel their upsetting customers or they might lose them if they pressure them too much for payment. Don't, you've done work for them and they've got a duty to pay, so they should cough up. A little leeway is fine but no more.

[Dazzer]

The banking crisis (The main catalyst for the worldwide economic recession) was caused by banks lending to too many individuals and businesses who were at high risk of never being able to pay it back.
You have to draw the line somewhere - there comes a point when you just have to say 'we are throwing away good money after bad here'. The bank will have had a good look at Staintons (Their accounts, order book, forecasts etc) before refusing additional funding, and rightly or wrongly, that's the conclusion they will have come to.