Did you know: that Ebeneezer Scrooge had been sorely and wrongfully maligned by those around him as a grumpy, mean, miser when in-fact he became an unpleasant person as a direct consequence of his customers repeated non-payment of invoices which ultimately caused him severe financial distress? He was forced to chase each and every shilling just so he could buy the slivers of coal he then gingerly rationed so everyone had enough to survive the winter. Did anyone ever thank him for his thoughtfulness? Of course not! Instead, they all complained about how cold THEY were, and they never, ever considering Scrooge’s age.
The ‘Bob Cratchets’ of the world could always spin believable and convenient excuses as to why they needed more time to pay their bills, like the ‘Tiny Tim’ tale……oh, how the townspeople showered the Cratchets with praise and sympathy while further vilifying poor Ebeneezer for his ‘lack of helping the poor’. Only Scrooge knew the truth that if things did not change he was destined for the poor house, or debtor’s prison, and that all of Cratchet’s stories were simply full of bah-humbug.
I ask you: Wouldn’t your customer’s lack of timely payments give you heartburn, and if the malady was bad enough wouldn’t it cause you to hallucinate and see ghoulish figments of your imagination? Well, poor Ebeneezer did suffer from horrible indigestion as we learned from Dickens’s. He explained Scrooge’s malady as a manifestation of stress, complicated by his daily diet of gruel. Yet, as tormented and ill as he was, Ebeneezer never complained about ‘HIS’ lot in life. No one knew he could ill afford more than his daily dish of mush. He was constantly worried that his customer’s poor payment habits were destroying the business he and Jacob built. No one cared about Ebeneezer, not even his silly simpleton of a nephew.
Was Scrooge’s worsening financial situation the real cause behind his recurring nightmares? Was he haunted and tormented by ghosts who would force him to jump from his bedroom window telling him to ‘fly’ due to non-paying accounts? They dragged him about London wearing nothing but his threadbare underwear to warm him from the frigid December night air. These apparitions of stale bread and bad mustard never considered Scrooge’s age or frailness. Cold and tired, these ghoulish fiends forced Ebeneezer to face and revisit painful memories of what he always considered his personal failures. These were the unfortunate tragedies that made him a lonely and sad man rather than a mean and miserly man. But did his tormentors ever care?!
The worst nightmare, the one that finally broke poor Scrooge’s flimsy hold onto sanity, was the one whereby a Ghost of his future appeared by his bedside. This phantom epitomized fear; a mere glimpse could make a stable person cringe in horror, Scrooge cowered in fear as this malevolent manifestation of his tortured soul forced him to go into a fog-enshrouded graveyard. The specter pointed to a freshly dug grave marked ‘Hereby lies Ebeneezer Scrooge.’ There were no ‘in loving memories’ or flowers or any other niceties. Just a cold and damp grave awaited this hardworking man. In a menacing voice, IT told Scrooge that this was his future if he did not change. The ghost’s declaration validated all of Scrooge’s worst fears. All the ills were his fault …….not the fault of all those deadbeats that stiffed him and caused him to be misjudged and maligned in the first place……..
DON’T GET SCROOGED!
- Past Habits Must Be Considered Prior To Granting Credit Terms
- Ask references for their experience with the customer
- Determine how much of a credit line they provided, and
- Ask for the ‘average days’ in which customer paid invoices. Were they within the required terms?
- Are there known problems of late payment?
- Was the customer previously placed for collection, or sued for non-payment?
Present Trends and Events Can Effect Payments
- Regional events, such as hurricane Sandy, will cause delays and should be budgeted accordingly
- Strategically plan with seasonal businesses to protect profits from the ‘down times’
- Newly formed businesses are higher risk,
- Terms should be considered based upon known viability & stability
- Granting credit is lending money. You should never loan more than you can afford
- Terms should only be extended based upon your ability, not the customer’s wants or need
Future Sales Promised Or Anticipated Are Insufficient Cause For Granting Credit
The past is the best predictor as to what can be expected in the future. If the past and present are not part of the ‘credit equation’ your future may include nightmarish incarnations of ‘would of’s, should of’s, & could of’s. ‘
