Give credit where it is due and have more satisfied customers


These days, we all buy things on credit. Even individuals who claim that they by no means borrow money for anything will borrow to buy a home - life in the twenty-first century is all but impossible with out occasionally borrowing money.

But what about people who've poor or nonexistent credit ratings? How are they supposed to manage?

Obviously most of them don't do too well, but they nonetheless need to purchase things, and we still have things to sell them: too many businesses dismiss the poorer end of the community, but it is worth remembering that there is a lot much less competitors and a lot more to be gained in the market as a whole. After all, there are more poor individuals than rich ones!

When Littlewoods' catalog started in the 1930s, John Moores (its founder) recruited his first agents by sending a mailing to his existing football pools gamblers.

At first, credit was limited, but Moores quickly saw the possible for giving credit towards the agents (who were themselves creditworthy) on behalf of the finish clients (who had been not).

The agents had a social bond using the finish clients, since they had been mainly friends, family, and neighbors: although they may be ready to back out of paying a big, faceless company, they could be unlikely to cheat their friends or family.

Incidentally, Moores was already a millionaire in 1932: he set himself the challenge of making an additional million from the catalog business, starting with only one office and four staff. He did it by 1936.

The system of offering credit via the agent continues to this day, even though in a somewhat reduced format: however, it nonetheless offers a potentially helpful way forward in times when credit is tight for many individuals.

Be extremely certain that the agents really are creditworthy. Recruit agents with great social networks if feasible - encourage "party plan" marketing to help this along. Be careful not to overstretch your personal credit.

Be prepared to be ruthless in cutting off supplies to agents who get behind in their payments. In the same time, be ready to advise agents who are having trouble collecting from their customers.

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This article was sent to us by: Jim C. Smith at 01202011

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