CHELSEA, Mass. — With the economic downturn has come a problem Boston distributors continue to deal with, even with the recession officially over: getting people to pay their bills.
Typically, said Steven Piazza, a salesman for Everett-based Community-Suffolk Inc., it’s not a question of whether, but when wholesalers get paid.
“It’s not too much people walk-ing away, just the time it takes,” he said.
Customers are still recovering from 23 days of rain last June, which put a serious dent in restaurant business on Cape Cod, a primary produce destination for many Boston-area wholesalers.
“They lost two or three weeks of business, and it’s been a slow go to get them to pay,” he said.
“I come to work every day with a list of who I’ve got to bug for money, and who I’m going to sell to and who not.”
Also, banks can still be tight-fisted about whom they lend to, which means wholesalers in turn have to crack the whip on credit with their customers, Piazza said.
“It all trickles up,” he said. “The banks are more tough, so we have to be more tough.”
No Boston-area distributors have gone out of business as a result of problems with late-payers, but the possibility does occur to Sam Rocco, president of BC Produce Inc.
“Who knows when the next shoe will fall and wholesalers will go under,” he said.
“The number of bad debts the last few years is astounding. We’re still trying to collect.”
Late payers continue to be the bane of Boston-area wholesalers, said Ken Cavallaro, treasurer of John Cerasuolo Inc.
“It’s the biggest hurdle to overcome in this business,” he said. “It’s something you have to stay on top of very, very closely. We have a lot of good customers, but inter-spersed with them are some where you just don’t know.”
Problems with late payers are better than they were in the past, after a weeding out process, said Frank Lisitano, president of Lisitano Produce Inc.
Customers who in the past took two, three or more months to pay their bills aren’t on the company’s radar anymore, Lisitano said.
“We’re on top of it pretty good,” he said. “We cut out a lot of people.”
“It’s pretty bad,” Rocco said.
Tom Ciovacco, co-owner of Mutual Produce Inc., is another Boston wholesaler who doesn’t think the problem of late payers has gotten better with the official end to the recession.
“To be honest with you, I think it’s gotten worse,” he said. “More so than ever before, you have to be more cautious.”
A residual effect — taking the time to analyze whether would-be customers will be reliable or not — also slows business.
“You have to determine whether you think a guy is strong enough,” he said. “It used to be a monthly thing. Then it was weekly. Now it’s a daily process.”