Daily Stand-up April 3, 2020

Stand-Up #55 - April 2nd, 2020 - BANKRUPT EDITION

Jack @jrf

Stand-Up #55 - April 2nd, 2020

Today's stand up is a little different. For those of you that don't know, I own a small web dev agency that is in the process of shutting down between now and the end of April. Currently, one large client, Carnival Cruise Line, is weeks late on two big invoices (soon to be THREE as of tomorrow).

I was on the phone and emailing back and forth with my points-of-contact there for much of the day today. They're cool people and I like them, but the accounts payable department is not responding to any of their inquiries on my behalf.

It will bankrupt me if the accounts payable department does not pay at least one of the three invoices by next Thursday.

Frankly, I'm disgusted with them. I've always paid my employees and contractors on time, so I expect the same from our clients. I've also never missed a student loan payment, rent payment, or small business loan payment. All of which I will likely now miss. I don't know if credit scores can go to zero, but mine will likely get close to that.

I've managed to scrape enough money together between my business and personal bank accounts to get my employees and contractors paid for the last time, because they deserve it since they've already done the work. I'll take the pain.

Yet I still owe them payouts on their saved vacation time, which I will be unable to pay out if this multi-billion dollar company continues to stiff me for work that we've already done. Our code is live on their site right now and our improvements are making them tons of extra cash, yet they can't pay a few high four-figure invoices to a small business.

I guess I'm just frustrated today and needed somewhere to vent. These last few invoices were supposed to pay off all of my final employee/contractor obligations, the rest of my student debt, the rest of my small business debt, and provide living expenses for the next few months while I work on my app. Instead I got screwed at the very end.

Yesterday's progress:

  • Properly hook shop and countdown models together in routes

Today's progress:

  • Go bankrupt

Tomorrow's progress:

  • Progress on the app continues! I'll work on either a validation function for the countdown creation page or a different navigation system because the current one is causing problems.

Today's stressed calls weren't really screenshot-able, so I have NOT attached a screenshot for proof. In the future, I will continue to attach screenshots as proof of the daily progress.

  1. 3

    That's terrible. Good on you for still paying your own contractors and employees.

    This line caught my attention:

    Our code is live on their site right now and our improvements are making them tons of extra cash, yet they can't pay a few high four-figure invoices to a small business.

    Is there anyway you can shutoff service to their site? That seems fair IMO, if you're actively communicating with them and asking them for payment, and they're refusing to pay, then you no longer should service their site. I'd give them 24 hours warning, then shutoff service.

  2. 2

    There are a few companies that pay out against invoices from large reputable clients in return for a percentage - not sure if cruise companies and airline companies will still be considered as reliable enough for this but worth a shot. UK company here: https://www.iwoca.co.uk/insights/iwocapay-payments-coronavirus/

  3. 2

    Wow, heavy to read.
    Awful to see that a company that is financially stronger as you mentioned, will not pay to force a company like yours to bankruptcy.

    I hope they will pay though and perhaps after this mayhem, you can pick up again!

    Best of luck! 🍀

  4. 1

    It may be due to all the COVID-19 stuff going on as to why they aren't paying. Sorry to hear.

  5. 1

    I'm so sorry to hear this. I suspect that Carnival itself is short of cash and potentially trying to fight off bankruptcy.

    https://www.investopedia.com/time-running-out-for-cruise-line-stocks-4801755
    https://investorplace.com/2020/04/ccl-stock-desperate-cash-raise-bailout

    When this happens, it's common practice for companies to just stop paying vendors except for the critical vendors they have to pay to keep the business alive. It's horrible and I feel really bad for you.

    This may not come in time but have you looked into the Paycheck Protection Program? You can apply for a forgivable loan for 2.5x annual payroll. 0.5% interest rate, no payments for 6 months, no personal guarantees required. Looks like applications start today.
    https://microconf.com/latest/us-covid-19-business-relief-paycheck-protection-program-overview

    Here's a bigger list of Covid-19 assistance programs:
    https://microconf.com/latest/covid-19-business-relief-overview

    I hope everything works out. Best of luck to you!

      1. 1

        Thanks for this. I don't think I qualify for the PPP, but I did make an application to the EIDL Loan Advance on the SBA website. It's my understanding that I can use it for ongoing business expenses, which means I will be able to pay my employees their owed vacation time and continue to pay myself a salary until the invoices roll in, so that I don't miss rent and utilities this month. I don't think I even need a full loan from them. The $10,000 advance would be enough to cover all existing expenses for the next month or two as I hammer the accounts payable department phone lines.

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          Hope it all works out for you. Hang in there!

  6. 1

    Hope they pay soon, mate! It would be terrible if not.

  7. 1

    Sad to read that.
    Cruise companies are damaged hugely by covid-19 crisis and probably they got more tight regarding payments.

    I think that you shouldn't be so stressed these days, as the entire economy is under huge crisis and all processes that have to do with payments (loans, invoices, even salaries) have been transfered to the future for millions of companies and individuals. Bankrupcy is still far at this point.

    I hope (and i beleive) that this all will end good eventually for you.

  8. 1

    Hey Jack, I genuinely hope those clients pay you as soon as possible...was worried when I read that title.

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    This comment was deleted 5 months ago.

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      Thank you for the suggestion, unfortunately I do not qualify. I already attempted to get a line of credit and was denied. I meet my bank’s requirements of having more than $100K in revenue for two fiscal years in a row (2019 and 2020), but I have not been in business long enough for them. They say that they would like to see two years of business history, but I have only been in business for a little over a year and a half.

      I also tried an unsecured small business loan but I was denied, although I had been granted them in the past and paid them back in full and never missed a payment. I am guessing that the bank is scared because of the virus right now.