Here is the latest blog from the mind of Nick Kerr…
With all of the technological and procedural innovations that are available in the credit management field today you would think that gut instinct is a outmoded and outdated concept, Wrong!
Every day I consult with my clients in the Tauranga and greater Bay of Plenty region about how to prevent debts , of course having up to date well written terms of trade and Veda credit checking facilities are an absolute must for any business that gives credit, but in my 8 years experience the best initial tool is the one you are born with, your gut and the instincts that emanate from it.
I have attended in excess of 6000 meeting with business owners in my tenure with EC Credit Control and I hear the same thing repeated in various iterations “ I knew something was wrong with that guy/lady” , “I thought this might have happened” , “ I had a bad feeling about this job” , “ I should have stopped the deal when they refused to pay the deposit” , or the very worst and the one I always make my clients repeat so it can sink in “ I knew he was a bad payer but I thought I would give him a chance” I liken this last one to the following conversation “ so Jim , why did you go inside the lion enclosure when you know he attacks people” Jim: “ well I knew he likes to attack people but I thought I would give him a chance not to eat me”.
When you walk down a dark alleyway your gut tells you that there is a heightened sense of danger due to the lack of light and the reduced escape routes should an incident occur, our senses are designed to protect us from danger but so often people ignore them in business because the desire to make a deal, increase cash flow or a misguided sense of obligation to a potential client causes them to ignore the indications that are present. You don’t have to stop giving credit but start seeing it as the money that it is , as silly as this sounds if you went to a company and asked for $500 cash they would laugh at you and say “no Way!!!” or they would do an in depth background check , make you sign a personal guarantee and put a security over your house. ask company for a 5k per month account and many will say yes just tell us where to send the bill, once the connection is made between the widgets and the actual monetary value things start to change.
Credit management tools like Veda advantage Credit Checking are there to verify information and give you reassurance when transacting with a potential client and nowadays are essential but so is a bit of common sense and trusting your gut. Remember Credit Is a privilege not a right!!