Do Business Well

10. Limit the supply of protective and special clothing

A number of companies supply special clothing such as jackets, overalls, gloves and shoes, all of which have a practical use outside the factory. It is also easy for special or protective clothing to be taken from a factory or office by simply wearing the outfit and walking out through the door.

11. Monitor scrap and reject materials properly

This is a frequent and effective method for transferring high value items through the factory gate or office door. Each scrap or waste bin should be thoroughly inspected by a senior person for each department who should also insist that no item is put in the scrap or waste bin without his approval in the first place. A further check on the content of scrap bins should be made by the security staff at the gate and spot investigations should take place as necessary. Careful watch should be kept on the contents of scrap bins as they are weighed in on entering the factory premises. Scrap bins containing water show a high dead weight reading which can result in a lower tonnage of the contents being recorded when the skip is full and the water has been emptied. Continue Reading »

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Finish the application with a requirement that the president or majority owner sign and date the document, acknowledging that the above is true to the best of their knowledge under penalty of perjury.

B. Call the references. It is so common for companies to go to the trouble to compile this application and then not make any calls.

When you call, have a prepared form ready to fill in the information that you receive a credit limit. It is a very good idea to send them a letter congratulating them on being granted open account status and informing them of their credit limit. You may want to suggest that if their account is paid promptly, you will be happy to evaluate the situation later for possible increases in the credit line. Continue Reading »

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I owned and operated a wholesale company with approximately one thousand retailers as my customers. I was completely computerized and sent statements to my customers every month in addition to their invoices.

We offered a 3 percent cash discount for payments received within ten days of invoice date. We charged 1.5 percent per month interest on accounts that were not paid within the standard thirty- day terms. The U.S. economy had enjoyed two very prosperous years. For all of these reasons, the company was collecting its accounts in an average of thirty days.

In addition, we had only needed to write off .5 percent of our total sales because of the bankruptcies or liquidations of our customers. This was excellent, given the number and quality of our customers. Continue Reading »

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Your approach to payment of your accounts may have almost as much impact on the performance of your company as does the collection of your receivables.

In a perfect world, we would all enter into small business with plenty of cash. We would make money from the first day, never outgrow our financial resources, and never have a crisis interrupt our ability to pay. I have actually known a couple of small business owners for whom this has been true. Continue Reading »

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Your credit record is your financial reputation. If you want to rent an apartment, buy a house, get a phone hooked up, get a credit card, take out a loan, buy a blimp, or start a business, you need a good record.

A company that wants to check your credit can call other companies that have done money deals with you in the past, or they can get a report from a credit reporting bureau. But if you’ve never been granted credit in the past, you don’t have a credit record. Where do you start?

Fortunately, you don’t always need a credit record. Some credit grantors realize that no record is better than a bad one. If you don’t have one, they’ll look more carefully at other information on your credit application: Continue Reading »

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Consider the following examples of organizational credit-grabbing:

Your boss has delegated the job of organizing the annual meeting to you, which his boss has assigned to him. You spend two weeks lining up speakers, reserving accommodations, organizing the agenda, writing and distributing invitations and drawing together a myriad of other details. At the closing banquet, your boss publicly accepts accolades for his fine job of organizing a successful meeting without mentioning your work even once.

You’ve asked another manager to contribute to a proposal you’re writing for submission to your mutual boss at a departmental meeting. The proposal is well received at the meeting, but you are annoyed when your colleague takes equal credit, referring often to “our research” and “when we were deciding on budget recommendations . .” Continue Reading »

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