Jesse van Sas, Secretary General at FIDI, on WridgWays’ liquidation

Jul 30 | 2021

First of all, I am truly saddened by the vanishing of WridgWays in the international removal scene.

Jesse van SanA 125-year-old removal brand, and a long-time FIDI Affiliate. A once big booker in the industry. I have visited the company a couple of times in the past and was amazed by the huge size of their operations throughout Australia.  It is sad to see this company go.

Companies do not last forever.  But the demise of older companies is not inevitable.  Many of these businesses, also in our industry, successfully withstand the aging process by not living on the historical successes or the merits of their sheer existence but by constantly and consistently rethinking the purpose of the business. This is another wake-up call in our industry, for our members, and for FIDI itself.

We could all see this coming though, in the past months. FIDI terminated Wridgways’ membership, based on their FASI [FIDI Affiliates’ Secured Invoices] record and the fact that they were no longer a member of the Australian FIDI Association at the end of June.  Shortly thereafter they went into liquidation.  We are now in the FASI due diligence process, carefully registering and verifying unpaid trade invoices from fellow FIDI Affiliates. Those who registered their FASI claim within the set time frames, will be included in the final distribution from the FASI fund (up to 90% of the invoice value).  FASI has proven invaluable over the past decades, compensating unpaid invoices from failed Affiliates (in total €2.5 million since 1989 were returned to our Affiliates as compensation for unpaid invoices).

While FASI is a great tool to ward off some of those financial risks, it remains a corrective and curative tool in case of catastrophe. It helps soothe the pain of those FIDI agents who see a whole range of unpaid invoices, following the bankruptcy of a longstanding fellow agent. However, FASI has its limits. The fund is (although impressive) not infinite/ limitless; and its principle is to react once the damage has been done. So effectively, FIDI and every FIDI Affiliate will continue to run a risk, unless we make sure pre-emptively that every Affiliate is financially in good shape and capable of paying the bills. In that sense, unlike FASI, the EY Credit Risk Barometer is a preventive measure. In due course this tool will ensure that only financially healthy companies are in FIDI. This will take the pressure off FASI, so that perhaps we can even reduce the FASI contributions one day.  After all, prevention is better than cure.

Photo: Jesse van Sas