How Price Increases Bad Debt?

It’s harder than ever to get customers to accept price increases, thanks mainly to Alan Greenspan. But you’re making a mistake if you don’t raise prices on a regular basis.

Alan Greenspan is a wonderful guy, and he has my wholehearted support in his battle against inflation. I doubt, however, that he has the same warm feelings about people who share my philosophy on prices. I believe that as a matter of sound business practice, it’s important to raise prices regularly.

Otherwise you’ll be letting your profit margins erode and undermining the value of your company. If you’re not careful, you could wake up one day and discover you’re in serious trouble. At that point you may have no choice but to take the kind of action that will drive your customers crazy.

“I don’t have a choice a small business told me ” We haven’t had a price increase in 10 years. I’ve been giving the staff raises every year, and I haven’t been getting any additional income. Now I’m at a point where I can’t go on without a significant increase. I won’t be able to pay my bills. The place won’t survive.”

Small businesses has my sympathy. It’s never easy to raise prices, and it’s particularly tough to raise them in an environment like this one, thanks mainly to Mr. Greenspan. He’s done such a great job of fighting inflation that most people think prices shouldn’t go up at all. As for big increases, you make them at your peril. There’s simply no way to do it without antagonizing customers and thereby putting your most important relationships at risk.

Faced with such resistance, a lot of businesspeople are tempted to forgo price increases altogether, or at least put them off for as long as possible. If you do either one, however, you’re making a big mistake. Granted, you may not feel the pain for a while. If your sales are going up, you’ll probably be able to take home the same amount of money from one year to the next. As a result, you may not see the risks you’re taking. In the short term, you’ll think you’re doing fine.

But, in fact, two things will be happening. First, your profit margins will be shrinking. Why? Because your costs will be going up. Even in Greenspan’s America, certain costs always rise. It’s what I call “creeping expenses.” Some types of expenses have a life of their own. If you don’t watch them like a hawk, they go up all by themselves. They may even go up if you do keep an eye on them.

In most small businesses, for example, you can count on payroll increases every year. You can expect regular hikes in insurance rates as well, and I’m not talking just about health insurance. The costs of utilities and supplies also have a tendency to rise over time. OK, some things are cheaper these days — basic phone service, for example — and computers let people work more efficiently than before. Nevertheless, your average costs per dollar of sales are going to rise from year to year. They may rise only 2% annually, but compound the increases over 5 or 10 years and eventually you won’t be earning a profit anymore — unless, of course, you raise prices.

Even if you don’t let the problem go that far, however, you’re damaging your business in other ways by not raising prices on a regular basis. For one thing, you’re gradually undermining the perceived value of your services or products. Like it or not, there’s a natural tendency to link quality and price. I’m not saying you always have to charge as much as the most expensive suppliers, but if the gap between your prices and theirs gets too large, customers will start to regard you as the cheap alternative in the market.

At the same time, you’ll be undermining the real value of your business as a whole. That’s a point most small-business owners miss. They look at the company only as a source of income. They forget that it’s also a major asset, probably their most valuable one, and — like any asset — it needs to be maintained.

That means, among other things, making sure the company has strong profit margins — as good as or better than the rest of the industry’s margins. If you let your margins erode, you’re going to have trouble when you try to sell the business. Indeed, you may not be able to sell it at all.

It’s sort of like selling a house. If the place needs a new roof, buyers will discount the price accordingly, or they’ll look for a house that doesn’t need one. By the same token, business buyers are going to shy away from a company with weak margins, especially if they’re weak because prices are too low. Who wants to buy a business and immediately start raising prices? Even under the best of circumstances, it’s tricky to maintain a customer base through a change of ownership. It’s almost impossible when you have to begin by doing something that will antagonize every customer you have.

So I’m sorry, Mr. Greenspan, but I’m going to keep raising my prices, and I’d advise most other businesspeople to do the same. The increases don’t have to be big ones. In this economy they can’t be. I have to fight for every increase I get, but I always insist on raising the price at least a little. I have to admit, however, that there is one group of people I’d encourage to ignore my advice and give Mr. Greenspan a hand in his fight against inflation: my suppliers.

Six Components at Burt & Associates

The Six Components of Leadership

There are six main factors that contribute to successful leadership, including vision, motivation, strategy, faith, values and responsibilities at Burt & Associates in Dallas Texas.Vision is a picture of the future that a leader wants to achieve, while motivation involves getting commitments from others to share that vision. Leaders must outline a strategy to achieve their visions and have a firm faith that they can overcome obstacles in reaching their goals. Values, with moral values coming ahead of economic ones, are important to make clear to employees at Burt & Associates in Dallas Texas Finally, leaders must take responsibility for any mistakes that occur on the way to achieving a vision.

8 Strategies to Improve Your Business Cash Flow

1. Social networking: The ‘free’ technology that’s anything but
2. Web Surfing: It’s costing corporate America $63 billion each year
3. Laptops and smartphones: These devices lead to 85% of companies having a security breach
4. Easy-to-decipher passwords: Sloppy habits are putting sensitive data at risk?
5. File-sharing tools: These are common threats that lead to large cash flow drains
6. IT’s policies on departing employees: Prevent them from wreaking havoc
7. Common office equipment: Overlooked technology that puts sensitive data at risk
8. Texting or talking behind the wheel: Lawsuits are skyrocketing and employers aren’t fairing well

Information from U.S. Bankruptcy Court

Have you ever needed information on a bankrupt business account but didn’t know where to turn? Don’t feel bad, most business professionals don’t either. The answer, however, is as close as your phone and often a lot quicker than searching the Internet, pulling up and searching bankruptcy websites you know of, waiting for the site to load, etc.

Each of the 91 bankruptcy court districts has what they refer to as an automated Voice Case Information System phone number or VCIS. Most are toll free. Simply call that number, press 2 and enter the case number (or enter the complete and accurate business name of your commercial account ) and presto, a recording will provide you with the business debt,attorney’s name and phone number, petition filing dates, upcoming hearing dates and much more. Try it and see how easy it is.

Commercial Business Watch Out on Bank Fees

Usually the more a customer pays, the more service or product is purchased. Not so with opportunistic banks who psych out businesses with computerized fee traps, a good process is
always look at your business statement to see if there are any hidden fees

Business Bankruptcy Protection

Many smaller commercial businesses may feel helpless when they find themselves low on the list of creditors when a large businesses files for bankruptcy protection. But smaller businesses do have recourse to protect themselves in the form of a reclamation demand. Such a reclamation provides a business the right to demand goods, which had been shipped to a customer, be returned if the customer files for Chapter 11 within a specific time period of receiving the goods. If the goods can’t be returned, the seller’s unsecured claim may be converted into an administrative expense priority claim. This move gives the claim a higher priority than ordinary unsecured creditors’ claims. Further, businesses don’t even have to wait for the bankruptcy filing in order to file a reclamation demand, which can be filed if evidence is presented that the customer is officially insolvent.

Business cry credit cards fees too high

Credit industry experts said customers' purchasing habits are dramatically different than just a decade ago as customers trend away from using cash.

In turn, many consumers have complained about the high interest rates that credit card companies charge, and now, some businesses that accept credit cards said the rates they pay to accept cards are unfair.

"People were still using cash more often -- using cash or checks for smaller purchases, like under $5 -- and, now, we don't think anything of using our card

Merchants must pay a fee every time someone swipes a card, which can have an impact on the businesses' bottom line. small businesses feel it most and have the least ability to do anything about it.

"Small businesses don't have a lot of leverage, or are (not) in a position to push back on these companies fmf oil is one of those small businesses. Company president john davis said he is not at all happy about the credit card processing fees his company has to pay with every transaction -- both a percentage and fixed fees. "They're actually making more money on a gallon of gas than we are," davis said. Davis has circulated petitions at his convenience stores throughout the state as part of a larger effort by a retail industry group to support congressional action that would increase the transparency of the fee structures and give retailers more power to negotiate. "They write the rules, you either take it or leave it and our customers demand we take it," Davis said.
The credit card industry sees it differently, responding to an inquiry by issued in a statement: "Retailers today receive tremendous benefits from accepting electronic payments, including guaranteed payment, the potential for increased sales, faster checkout times, as well as greater convenience and security -- all at a fair price. The petition drive is part of longstanding and failed attempts by retailers and their trade associations, who are no longer content with paying their fair share, to pad their profits by shifting their normal cost of business onto consumers."

The petition drive that at FMF oil locations around the state continues until Wednesday, after which time the signatures will go to a national trade group that will forward them to Congress.
For other information like this, visit Burt & Associates blog

Do your Research

Before filing a lawsuit against a commercial account account, there should be a chance for recovery, otherwise it would be a waste of time and money to try to collect on that old accounts receivable. A creditor should obtain as much information as possible, not just from its credit application, but it should also conduct a search for tax liens, review a company’s corporate annual reports, etc. before agreeing to file suit against the debtor for an old balance. Using Internet search engines and services to obtain the latest information on a firm as well as reviewing the above information, just may save you, the commercial collection agency and the attorney handling the potential lawsuit time and money.

Inflated Accounts Receivables

Business deductions, whether valid are invalid, can be a nightmare to those who deal with commercial accounts receivables. Often such deductions as discounts , pricing and even sales tax can sit on an A/R ledger for long periods of time until they are either credited or paid back by the business customer. There are dozens of different kinds of deductions that customers take. In fact, numerous surveys have shown that more than 80% of the time deductions are valid and should be credited promptly. Some companies have systems in place that allow for a quick resolution of these items, yet in other firms (and it often varies by industry not necessarily business to business ) deductions can sit on a company’s books for as long as six months or more. The result? Inflated accounts receivables that in the long run can cost your company money. If a company’s credit line is, even in part, tied to it’s a/R, then the inflation of this current asset could adversely affect the amount that company can draw against–a thought to consider when evaluating your overall A/R status. for more information on tips check Burt & Associates in the blog section.

Salesman Personalities - Burt & Associates Videos

Taking Control of your Accounts Receivables

Particularly in tough economic times, it’s more important than ever to keep control your accounts receivable lest they start to control you. As such, it’s important to always have in place clear credit and commercial collection policies in order to keep accounts receivables from getting out of hand. Look at your A/R listings to review your customers, their credit limits, payment terms, what their credit history is like and when’s the last time their credit limits were reviewed. With that information, credit and financial executives are in a better position to decide who to extend credit to and how much. Also, to better gauge risk, always look at a debtors’ bank and credit references, employee information and financial data. Also look at a firm’s history, who its customers are, what the competition is and how the firm is poised to face current economic conditions, especially in these times of dampened business credit markets.

Can you tell if a business account is to far gone

In some instances, you can tell if a company might be irreparable. If a troubled company no longer has an addressable market that is ready to embrace its products or services, that company may be to far gone to turnaround of commercial collections. Moreover, if the company has no clear understanding regarding why it needs to clearly communicate its product’s return to the marketing place or if it can not quantify it product’s value, the hope of any “quick fix” for that troubled firm may be beyond consideration. And just as important an indicator is if the leadership of a troubled firm does not have the ability to become systematic and entrepreneurial-minded. Trying to fix such a company may be throwing good money after bad let Burt & Associates help you with the answers you need in troubles time so that you don”t have to lose your money on bad debt.

6 quick commercial collection tips

1.- One of the most important relationships principles between sales & commercial credit is trust

2.- When trust is missing it may be easy to misinterpret comments or wrong motives to others

3.- It is essential that sales & commercial collections understand eash others agendas

4.- Expanding accounts receivables and minimizing past due commercial collections

5.- Develop clear policies and procedures to turn past due commercial accounts in to www.burtcollect.com for collection

Solving Business Bad Debt Problems

If you already have a business and have operated it successfully – congratulations! You know you have had to overcome many obstacles to succeed. But as time passes and conditions change your business may need to adjust – and you may be seeking new ideas, new solutions to help you with commerercial collection bad debtYou may need: to develop new markets; new marketing strategies; to update and organize and your collection procedures; to change your legal structure; – or any other of a number of different issues which arise periodically.

At times like these,burt & associates can help you – and its all free!

Come and visit www.burtcollect.com for assistance, call jerry curtis today 1-877-740-7839

TO CASH OR NOT CASH BUSINESS CHECKS

If you receive a payment from a debtor on business account and the words “acceptance of this check denotes payment in full” should you cash the check? The answer differs depending on the state law and the facts of the situation. One of the main issues in determining whether a satisfaction of a debt exists is whether there is a “bona fide” dispute between the parties regarding the amount owed. Generally, when there is a bona fide dispute between the parties as to the amount of a balance owing, one party can offer to pay a specific amount in full payment of that debt. The other party can accept the offer in cash or check — which is referred to as “accord and satisfaction”. This is essentially like a new contract. It should be noted that a dispute does not have to be based on a solid foundation but there must be some justification to it.

Note, however, that a business who receives such a check may not simply cross out the language and write “under protest” in order to get around the “accord and satisfaction” concept.

It should also be noted that while some companies process thousands of checks, nevertheless, some courts have held that when a creditor’s accounting department cashes a debtor’s check in ignorance that it was an attempt to “accord and satisfaction”, a subsequent timely protest by the creditor defeated a finding of that “accord and satisfaction”. In some states, however, where a claim is disputed and a check is offered for settlement, the retention of a check constitutes an “accord and satisfaction” settlement regardless of any protest by the creditor. Also, under Uniform Commercial Code 3-311 a creditor has the right to revoke an “accord and satisfaction”.

KEEP COMMERCIAL ACCOUNTS FLOWING

1. Do Your Homework Before Doing Business: This is cold comfort for those struggling to squeeze a dime out of currently delinquent customers but good practice for new ones. Forward-thinking accountants can check the credit rating of a business through our burt risk scoring system while also checking references.
2. Set More Favorable Credit Terms: Stacking the deck in your favor is smart practice. One strategy is to require credit card payments; that way, the payments are predictable (i.e. you’re in control) unless the customer severs the relationship.
3. Explain Credit Terms Upfront: let your customer know that you’ll charge late fees after X number of days and then send it to commercial collection agency after Y number of weeks will be more motivated to pay on time. And requiring payment within 15 days instead of 30, offering incentives for early payment, can ensure that you’re at the top of the list for who gets paid first.
4. Use the “Velvet Hammer” Approach: Some business experts insist that treating customers as parnters can go a long way toward putting your company’s name at the top of the list when it comes time to write checks. Some even say that tacking on interest only hurts the relationship and may even backfire.

If you’re still struggling to get paid using these methods, go to www. tipsforyourbottomline.com provides some tips on how to get paid.

WHY IS BUSINESS DEBT UP

US Postal Service

reported a net loss of nearly $730 million for October and November, its first two months of its new fiscal year, as mail volume fell 4% from the previous year’s figures. Postal authorities are anticipating a net loss for its current fiscal year of $7.8 billion. This compares with a net loss of $3.8 billion for fiscal 2009. Does this affect our business debt if these numbers are this high.

COMMERCIAL COLLECTING THE RIGHT WAY

HOW TO DO COMMERCIAL COLLECTING THE RIGHT WAY

Sometimes it means just doing
whatever you are supposed to do with a positive attitude. Other times it might mean going out
of your way or making an extra effort to help a commercial customer. Anybody can be okay – average. It
is the excellent people and the excellent companies that are willing to do the extra things
necessary to not have just satisfied customers !