Page 95 - Paulisms: Gold Nuggets for Small Business

years did I allow liquidated damages, and again, that is something to be negotiated out.
3.4 Bad debts
As mentioned under P&G, recently several big construction companies in New Zealand have gone down in very buoyant times. New Zealand is going through a massive commercial and residential building boom – but if you look back, a lot of those companies weren’t there 10 years ago, and if you look forward (into your crystal ball!), many of those companies are not going to be there 10 years from now. Just as many companies go bust in buoyant times as they do in recessionary times. So, whether times are recessionary or buoyant, you really need to be on your toes. In construction and development, companies often close down the company once the project they are working on finishes, or they trade under several companies, e.g. XYC company Commercial, XYZ company Wellington Ltd. Be careful. Many have no intention of being around long term and their assets are all tied up or hidden. It’s the poor supplier, sub-contractors or you that gets hurt the most.