Wednesday, April 1, 2020

Letter to Vendors for Enhanced Credit Period During Covid-19

To <vendors in BCC or specifically to each major vendor>
Sub: Request for Enhanced Credit Period


Dear Sir,

At the very outset, we would like to wish safety and hope for better days ahead to your company and all its staff members and their families.

This has reference to the sudden shock that has befallen all of us due to the Covid-19 outbreak, which has put most of our business and the industry on halt.

Our company is a medium-scale enterprise in an already bleeding industry facing a slowdown. We are currently in the midst of collecting all our pending receivables from clients who are cash-rich global enterprises so that we can manage enough liquidity to ensure that our labor workforce, who are daily wage earners, are paid in time so that they can last this period of shutdown without having to go empty stomach or having to resort to the streets in want of basic necessities and work.

In the meanwhile, we have also written to our bankers to enhance our credit facilities so as to provide support as referred to by the RBI in its relief measures announced on the 27th of March, 2020.

In these tough times, we would want to make the following requests to you.

1. Enhancement of Credit Period: If any payments for supplies made before 31st March 2020 are falling due to you within the months of April or May 2020, we would request you to bear with us for our factory and office to be opened after the lockdown, so that we can get our operations running once again and start releasing all payments in a planned manner to all vendors.

2. Non-Charging of Interest: We are trying our level best to ensure all our vendors are paid in time and there is no hardship to anyone due to us. In our attempt to do so, we seek your support and would request you to not raise any debit notes on us for delay in payments in the form of interest or penalty charges, as we will be unable to bear any such additional costs in these tough times.

3. Confirm before Depositing Cheques Issued: If our company has issued you post-dated cheques which are due for encashment between 1-Apr to 31-May-2020, we would request you to speak with the undersigned before depositing them with the bank, so that we can ensure there are adequate funds available in the bank account and the cheques are not dishonored. In case of non-availability of funds, we may ask you to wait for a few days till funds are arranged for from our bankers and few cash-rich customers. We assure you that we will be working hard towards planning your payment on priority in our fund flow plan.

We seek your support in these testing times and are hopeful that the business community will be able to collectively sustain these difficult times with mutual support.

Thanking you and wishing safety on you all.



________________ Ltd.