Retailers, there’s something we need to talk about. Doesn’t matter if you’re big or small…independent or franchise…storefront, internet, or home studio (yes, you).… If you’re late on even one invoice right now, we need to have a chat.
Now, before every nerve in your body tenses and every muscle jumps into “fight or flight” mode, please hear me out. I’m not going to yell at you. I’m not going to lecture you. And I’m not going to pretend that in my previous life as a retailer I was never late on an invoice. It happens to everyone.
What I am going to tell you is that you aren’t alone. Truth be told, the number of retailers (of all ilks) running late on at least one invoice far outnumbers those who are completely up to date with their payments. It’s the nature of a flat line consumer who has a death grip on their wallet. If they don’t spend, you can’t spend. Just works that way.
The other thing I need to tell you is that your vendors are equally as cash strapped. And nervous. And scared. After all, when your customers’ death grip on the wallet translates into your death grip on the checkbook, their creditors and bankers get irritable. Very, very irritable.
And their reps don’t get paid. Want to talk about nervous? In most cases, they make the same (or less) money than you do to begin with. When that dries up, well….
So, dear, dear, lovely retailers, I need you to do something. At first, it will be very hard, and very humbling, but you need to trust me here. Once it’s over, you’ll feel better.
I need you to pick up the phone and talk to the vendors you owe money. Yes, those vendors. The ones whose invoices are past the due date.
I know…I know…it will be incredibly difficult to do. It will make your stomach clench and your heart race. You’ll feel like you want to either cry or pass out. Or throw up. Or all three. You’ll try to find anything-—anything-—in that stack of stuff on your desk that will justify delaying even another half hour.
But you can’t. You need to do this.
As I talk to vendors and reps around the country, they voice one consistent plea: That retailers having trouble with their invoices please pick up the phone and talk to them. The vast majority are willing to work things out, one way or another. Your survival is critical to their own.
Just talk to them.
They know it’s rough out there. They know you can’t force customers to shop. And they know you’re trying.
You’ll be amazed at how easily things can be worked out if you give them a chance. If they simply hear your voice.
In the words of a retailer I love and respect, “That’s all they want from us right now, is to work with them. It makes all the difference.”
Stay tuned for tomorrow’s post. It’s my heart-to-heart with vendors.
Click here to tell me what you think....
Cinda, I know from past experience that this is the ONLY way to deal with vendors if you are in danger of being late on payments. You cannot imagine how easy it really is to do, once you just pick up the phone. Start with talking to the person you know best in the vendor’s Accounts Receivable or Accounting Department. All they really want to know is that you are trying your best, that you know you will owe them money and that you intend to pay it as soon as you can. Tell them WHY you will be late, WHEN they can expect either full payment or partial payment, tell them WHAT you are doing to try to remedy the situation, and that you APPRECIATE them and all that they have been doing as a partner with you in your business. Tell them that you will give them weekly (or monthly or whatever is appropriate for the situation) updates on your position. Remember that in situations like the ones in which we find ourselves today, “all you can do is all you can do” but showing that you are making the extra effort to get it all done is worth millions!
I agree wholeheartedly with Karen’s post. I closed my store last Saturday and am re-opening in a new location April 10th. I have three weeks of downtime–with no revenue coming in to pay for the thousands of dollars of merchandise I need to re-open. Luckily, I have two fat bank accounts from previous sales but I have to manage this very carefully to pay for start up costs at the new location. So, for the numerous orders I received early that are just sitting there in unopended boxes, I have called the vendors and asked if they would engage in some creative thinking around invoicing–asking for net 30 from my opening day or to compromise somewhere in the middle. All the vendors I have spoken to have been very understanding and so far it’s worked out in my favor. I SO APPRECIATE their willingness to work with me, and will not be a day late with the payments I have negotiated.
I did most of my buying for this new store at the Atlanta show in January. Many of my orders arrived too early, even though I called the showroom asked them to get in touch with the vendors they rep to change some of the ship dates. I would of called the vendor directly, but some of my orders were with new vendors and I didn’t have their phone numbers.
Email has also worked great for me. I talk to the vendor once on the phone, get their email, and then I email them with the payment status, and I email them a payment confirmation. It is fast, and keeps them updated. I also ENCOURAGE my vendors to contact me anytime they want an update. Even though my credit has taken a hit, I still am flowing product.