Late Payment. It’s not smart. It’s irresponsible: The Communications Council CEO Tony Hale issues statement on ad agency payment terms
VoxComm, the new global voice for agencies, has released an announcement on behalf of multiple agency associations regarding advertising agency payment terms.
Statement from Tony Hale, CEO, The Communications Council:
The Communications Council is an active contributor and supporter of VoxComm and, on behalf of our members, endorses the VoxComm global joint agency association announcement dated 19 May 2020.
In Australia, we have so far been spared the very worst of COVID-19 both in terms of infection rates and economic impacts when compared with Europe and North America.
However, in common with our Northern Hemisphere counterparts, we are also experiencing the worrying, underlying trend whereby contracts are being drawn up by clients that include extended payment terms for agency services.
We believe this is unacceptable: no client should ever expect its ad agency to bankroll its business. This is especially relevant during COVID-19, when agencies are having to manage their own businesses and cashflows more carefully than ever.
That said, the current crisis has had a devastating impact on many industry sectors and Australian companies.
It is gratifying to note that the bulk of clients and their ad agencies in this country have been partnering productively to find solutions for businesses who are experiencing genuine cashflow problems.
Strong partnerships will always find mutually acceptable ways to overcome challenges by working together.
However, TCC strongly believes it is an egregious betrayal of trust for any client to deliberately use the COVID-19 crisis as a convenient trigger to delay payment or extend contracted payment terms.