Awards & Engraving

August '17

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16 • A&E AUGUST 2017 your business, then you will learn about a leverage tool in your business tool box that can greatly increase your chances for success. The trick is to use it and not let it use you. Credit, when extending it to your cli- ents, must net you something back or why extend it in the first place? Think about credit that is extended to clients. While many of your clients might think they deserve credit just "because," it is a delicate and sensitive part of business and normal life. When I was a boy, no one had credit cards. The public has been educated to use them, but not everyone understands how to use them to attract business. Those clients who want credit, which is normally net 30 days, can be presented with the option of a credit card. This might help you with the client you want to collect from at the time of pick-up, but they want credit. Let's take a moment to understand what net 30 means. That means the payment is due on or before 30 days. That doesn't mean you mail the payment on the 30th day and it arrives whenever. Many people mail the payment on the 30th day and it is late when it arrives. You might want to adjust your accounts payable to be sent on the 25th day. When the client puts payments on their credit card, they are getting about 25 days credit if it is at the right time of the month. You might offer to take their credit card at the first of the month—that gives the client from the time of sale to the first of the month, then they will receive the 25 days until due. In most cases, I suggest putting the sale on the credit card at the time of sale. However, if you are working with a "special" client, you can give them special terms that might seem helpful and at the same time leverage your company to being more attractive to buy from. Getting back to who we should extend credit to and why: Accepting credit cards is a regular business practice and is nearly a necessity for all businesses, both large and small. But who we should extend credit to is a judgement call for most businesses. If PEOPLE BUY FROM PEOPLE "Credit is a tool to help you collect when you want to and the extension of credit is a privilege to those who deserve it, and not everyone does."

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