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Credit Matters
What's New At Credit Matters?

What's New At Credit Matters?

This month we are pleased to introduce a new feature for Credit Matters, “The Anatomy of a Recession”. This feature is designed to assist business people understand the features of a recession and how they may prepare to protect themselves if a recession occurs. You can obtain a copy of the feature by contacting kim@creditmatters.com.au or visit www.creditmatters.com.au and access a copy via the website.

As a side issue, if you are a numbers person, it is sobering to realise that we have already passed the average 10-year deadline of when another recession may occur.

The attachments this month include The Bank Doctor's "Learnings from the Banking Royal Commission", RSM CFE Exam Review Courses in Australia - 2108, The Telephone Flyer from Credit Matters / Sales and Telesales Soluions and creditor(watch)'s new ApplyEasy product.

If you are interested in advertising with Credit Matters, please contact Kim and see what he can do for you. You will be surprised at the very reasonablly priced packages which can be arranged to promote your business.

Quote Of The Month

Quote Of The Month

I insist on a lot of time being spent, almost every day, to just sit and think. That is very uncommon in American business. I read and think. So I do more reading and thinking, and make less impulse decisions than most people in business.

Warren Buffett

Monthly Business Observation

Monthly Business Observation

It is well known, that many business owners often work very hard in their business, and not on their business.  This month’s quote from Warren Buffet is a timely reminder that we all need to spend time re-evaluating our business.

Working on your business requires quiet time away from normal daily work duties and should include reading on the different aspects of operating a business.

It appears to me that many business people do not often take the time to reflect on the way their business operates, on their business’s financial figures or what is happening in the world around them.

Following is a very brief review of a number of aspects which may be of interest if you were to actually take the time and just reflect on your business’s affairs.

1          An unpaid invoice is both an ongoing liability and your money in your customer’s bank account.

2          An unprocessed credit claim/deduction is your customer’s excuse not to pay you. In addition, every credit claim/deduction costs money so it makes good sense to eliminate the causes of credit claims/deductions.

3          You reconcile your bank account to protect your business’s cash. Reconciling your accounts payables and receivables protects your cash, plus saves money.

4          There are no friends in business. In fact, family and friends are your most dangerous customers. If you want to keep friends and family and do business with them, insist on cash up front.

5          Fraudsters are often better at stealing business assets than you are protecting them. Fraudsters can exist externally and internally due to technology, which is one of their best tools.

6          Risk is a natural part of the business landscape, so you ignore it at your risk.

7          A business without cash is not a business. Try operating a business without it!

8          Beware of people who say cash is lazy. These people usually want it for themselves or operate to an out-of-date ideological mandate. Cash is never lazy, it is always a sleeping asset waiting for the right opportunity to add value to your business.

9          Nothing destroys value quicker than a technology wall between you and your customers or suppliers. Technology walls hinder timely and effective communication between your business and its stakeholders.

10        If you are afraid of your customers, you do not own your business. It is important therefore that you understand that you have a right to operate your business your way, providing it is legal of course. In addition, you are always within your rights to question and refuse to adhere to unfair or unreasonable demands from your customers.

These and other issues are important factors in helping you survive and grow your business. The issues which confront us all in business can easily be forgotten in the hurly-burly of running a business.

If it is good enough for Warren Buffet to take time to read and reflect about how to make his business better, it stands to reason, you will also gain value by taking the time to read and reflect on your own business affairs.

Monthly Business Conundrum

In business we like to accumulate every customer possible. Sometimes however, this policy costs money, especially when selling on credit. 

 

There are many reasons why customers may not be profitable. There can be strategic reasons why you might keep an unprofitable customer if you can PROVE they add value to your business in another way.

 

Of course, you should still try to keep every possible customer, even if you only break even. Alternatively, you may have to change how you do business and use a different sales strategy.

 

If the customer will still not cooperate, it can be to your advantage to introduce them to your best competitor. After all, if they cause a loss for your business, they will almost certainly cause a loss to your competitor.

 

Business is full of conundrums such as whether you should keep an unprofitable customer or encourage them to leave for your competitor. It is your responsibility to work out what is best.

Monthly Business Conundrum
This Month's Business Inconvenient Truth

This Month's Business Inconvenient Truth

Shotgun marketing is often not a profitable exercise, and neither are shotgun accounts receivable emails.

One of the greatest problems of the modern technology age is the persistent flow of spam and unwanted marketing emails. If you are like the average business person, these emails are sent straight to the junk mail folder. Therefore, even if you are genuine business person trying to reach a new customer, you have probably lost any credibility with that potential customer.

For a different reason, repeated emails for outstanding invoices which are sent out in a shotgun approach to encourage the customer pay, also often go unanswered, or just sent to the junk mail folder.

Sending out endless emails for outstanding invoice(s) because it is considered to be the cheapest option, is often a similarly fruitless and unprofitable exercise.

Increasingly, whether it is for unanswered sales or accounts receivable requirements, at some stage of the exercise, the personal approach is usually required. Email marketing and accounts receivable contacts can be valid however, if used in the right context. At the end of the day, as more and more frauds are initiated by email, the supplier will realise, it is the judicial use of email combined with the personal contact, which brings the best results.

Shotgun marketing is often not a profitable exercise, and neither are shotgun accounts receivable emails.

One of the greatest problems of the modern technology age is the persistent flow of spam and unwanted marketing emails. If you are like the average business person, these emails are sent straight to the junk mail folder. Therefore, even if you are genuine business person trying to reach a new customer, you have probably lost any credibility with that potential customer.

For a different reason, repeated emails for outstanding invoices which are sent out in a shotgun approach to encourage the customer pay, also often go unanswered, or just sent to the junk mail folder.

Sending out endless emails for outstanding invoice(s) because it is considered to be the cheapest option, is often a similarly fruitless and unprofitable exercise.

Increasingly, whether it is for unanswered sales or accounts receivable requirements, at some stage of the exercise, the personal approach is usually required. Email marketing and accounts receivable contacts can be valid however, if used in the right context. At the end of the day, as more and more frauds are initiated by email, the supplier will realise, it is the judicial use of email combined with the personal contact, which brings the best results.

Word Of The Month

Is the spelling forego or forgo?

 

This is actually a trick question. Like the words to, too and two, forego and forgo are known as homonyms. Two or more words that sound same, that are spelt the same or differently, but have different meanings.

 

Forgo has the meaning to go without and forego has the meaning to precede. A couple of tips to help remember when to use which spelling are: forgo has no e, so goes without, forgo starts with the same letters as does forget, whereas forego starts with the same letters as before.

 

Forego is listed as a secondary spelling variation of forgo. This would appear to be because so many people incorrectly use forego when they actually mean forgo, that the spelling becomes recognised as a secondary spelling variation.

 

The following sentences show the different usage. When dieting I will forgo dessert. Often soup will forego the main course.

 

Because forgo and forego are so similar, it’s a foregone conclusion people may confuse the two words.

Word Of The Month

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Future Opportunities & Possibilities

Credit Matters is continuing to grow and provide marketing and knowledge about financial risks to the Australia business community.

Futhermore, we invite marketing and knowledge ideas from our readers and contributors on how we can assist our respective firms grow. If you have any ideas, please contact me at info@creditmatters.com.au.

If you are interested in finding new ways to reach your marketplace, why not try Credit Matters. Our prices for advertising are very reasonable and advertising packages are on offer to make any cost, even more affordable. So if you are interested in reaching your customers at the right price, please contact Kim at info@creditmatters.com.au for options.