Al Misk battles on

Al Misk is calling for support and understanding from both its suppliers and customers as the Dubai-based reseller battles through ongoing cashflow problems. The company has now put in place a payment plan for its creditors — to whom approximately US$1.36m is owed — and has vowed to trade its way out of its financial predicament.

  • E-Mail
By  Stuart Wilson Published  August 17, 2006

Al Misk is calling for support and understanding from both its suppliers and customers as the Dubai-based reseller battles through ongoing cashflow problems. The company has now put in place a payment plan for its creditors — to whom approximately US$1.36m is owed — and has vowed to trade its way out of its financial predicament. Naila Jamil, manager at Al Misk, outlined the problems facing the reseller as it is mercilessly squeezed between aggressive creditors demanding the repayment of credit lines and customers withholding monies owed due to the ongoing speculation about the company’s long-term future. “When a problem occurs few of the creditors are ready to take the time to listen and understand our problems,” said Jamil. “The business needs to be stable in order for us to receive accounts receivables. We have been dealing with customers for many years and it is only when these problems and rumours surfaced that the payment of receivables started to slow down.” According to Jamil, Al Misk’s current level of accounts receivable stands at some US$1.5m. The company has an established customer base spanning several major markets including Africa, Saudi Arabia and Kuwait. These companies, which number just under one hundred, have unsecured credit lines with Al Misk and always paid regularly in the past. They are now deferring and postponing payments. “I have already paid off almost US$700,000 of the outstanding credit lines with my suppliers but few of these companies have supported us in return,” continued Jamil. “We have been under tremendous pressure for two months and have now teamed up with a legal consultant and the computer traders group to come up with repayment plans for our creditors. We are also involving the relevant authorities and keeping them informed of our plans.” “Problems can happen with any company in this market and we just want the freedom now to work in order to pay off our debts,” Jamil continued. “I have told people that if they want to go to the police they can.” Several suppliers have already approached the authorities to take action against Al Misk and Jamil has received several visits from the police. She also claims that companies have also approached her landlord expressing an interest in taking over Al Misk’s showroom on Computer Street. “We gave our passports to the traders group at the end of May and we want to get through this. We have not run away. People need to sit down with us, understand what we are doing and the channel community needs to show support. The last few months have been torturous,” Jamil concluded. In early June 2006, Al Misk stated that heavy-handed credit collection techniques from distributors were exacerbating the financial crisis gripping the local channel. The company claimed that suppliers were tarnishing the reputation of Al Misk meaning that its customers were less likely to pay for product bought on credit.

Add a Comment

Your display name This field is mandatory

Your e-mail address This field is mandatory (Your e-mail address won't be published)

Security code