Building Business Trust with Money Factoring
Why is trust important in business and How do we build it?
Business owners paying bills on time. Their word is their bond.
Trust is built everyday by rock solid business’s practises. However it certainly can be lost faster than it was earned.
What happens when it is broken?
When it is broken it sometimes isn’t easy to just cut the person loose. This does depend on the severity and previous relationship established.
In a professional relationship caution is required if you are ever asked to enter into a business relationship again. For example; there was an earthmover who regularly did jobs for a company. The invoice would be put in and paid within 30 days. One day it just wasn’t paid. However the work for the earth mover was piling up for this company.
As friends the earth mover continued to do the jobs believing it would be paid eventually. Thousands of dollars later, that company said they would not be able to pay their debt. They knew this would possibly be the case however they proceeded to use their earthmovers resources knowing that it would never be returned.
Any work asked of the earthmover from that point was declined and that relationship was ended. They’re is some horror stories out there but what we learn from it is the only valuable thing we can take away from it.
how could factoring help this situation
This client could have set up a facility. The Factoring firm would have been the third party collecting the invoices. The client would have had no direct connection and work would have ceased earlier. This would have avoided a much larger bad debt.