What considerations that a seller should take into account before giving credit to a new customer
- Thread starter Stardom22
- Start date
In my business now, I don't give credit to even my wife and my self. Everything is strictly on PAY AND CARRY.
This might not really work because a lot of them will not be truthful about it. it is to make your research yourself
Before you give goods on credit, you must ascertain the person's credit history from other vendors around. Some people are owing the vendor close to you and can't get any more credit there, that's why they turn to you.
You are right it is always good to ask around to detect some chronic debtors as soon as possible before giving them your money
Your relationship with the individual matters a lot, how close are you to the person in particular, how much do you trust the person and most importantly, are you willing to let go of the money if things do not go as planned?
Before giving credit to a new customer, you should check if the person or his/her company is trustworthy. You should also check the history and background of his/her company. If possible, check the credit rating of the person with a credit agency.
Goods can be sold on credit to a creditworthy customer.
This is a common practice in my place. A person that just stops buying from a particular place he or she used to buy before is very likely owing. You have to ascertain that before giving credits.
I also have the same business principle. It is a principle of having this phrase: "Business is a business." If we allow the customer/s, it will be abused and in the long run, they might not pay us what are due.
