IMC experts task APCON on 120 days new payment policy by advertisers
Practitioners in the Integrated Marketing Communications industry (IMC) have tasked the Advertising Practitioners Council of Nigeria (APCON) to as a matter of urgency write letters to all the multinationals insisting on 30 or 45 days payment period.
They argued that the current practice where multinational clients insist on 120 days payment was killing their businesses, stressing that the issue was still pending because of the lack of unity in industry amongst practitioners.
The Business Unit Director, MediaReachOMD, Promise Oduh, pointed out that P&G is one of the multinational companies that insist on 120 days payment. Mr. Oduh stated that the 120 days payment period was too long and counterproductive, noting that the 30 or 45 days payment was the ideal payment period which is favorable to business growth.
“The 120 days payment period was killing the business of the agencies as they could not be able to run their businesses effectively. I think what is happening is that a lot of multinationals are actually insisting on 120 days payment period and it is not good for us because you have to pay media partners and at the same time there is quite a number of other cost.”
“There are other cost that you have to incur to be able to run your business and so 120 days takes you to about four months and then you have not even factored in compliance issues, you have not factored in other costs associated to the media,” he lamented.
Mr. Oduh alsos said that the 120 days payment was against APCON rules, insisting that APCON should rescue the agencies by writing letters to all the multinationals and insisting that agencies be paid in either 30 days or 45 days because agencies cannot do it alone.
Speaking in the same vein, the Executive Secretary, MIPAN, Eki Adzufeh tasked APCON to give substantial reasons why they could not enforce the 45 days payment as entrenched in its laws, stressing that these multinationals could not practice such in the countries where they have their headquarters.
Mr. Adzufeh, however, called on agencies to be united in fighting against this payment period, stressing that it is the competition to outdo each other that is making the multinationals play on their intelligence.
In his words: “I think we should ask APCON to give reasons why they cannot implement the 45 days payment period and insist that multinationals adhere to it.”
“We need to come together and agree to it else our selfish desires can bring down any good intention. But I think it’s still a work-in-progress and by the time we agree; clients, agencies and media owners will know and when we take a decision, everything will work fine,” he said.
On a more serious note, the Publicity Secretary, MIPAN, Yinka Adebayo, pointed out that the 120 days payment period was so pathetic. He painted a scenario where a client would own an agency and move to another agency and still bring another business to the former agency which it will still accept, adding that it’s a typical case of survival.
“When you accept a business from a client known for owing different agencies, you are not making it compelling for that client to pay up the debt. We need to come together as one and make sure that once it is identified, something drastic has to be done and until we get to that point we will still be suffering this problem,” he said.
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