Replies

He handed me the check and asked me to refill my racks with merchandise.

Because of the cultural differences I can’t be certain, but I believe that because the check was written, calculated into his bank account and he planned on giving it to me at some point he figured that was good. Most of the store owners from that country that I sold (unfortunately a lot because they had cornered the gift shop business in central Florida) would only pay us vendors when we came in and demanded payment. I surmise that is the accepted way of doing business where they came from. I think it was considered perfectly ethical to withhold payment as long as possible.

Here’s another good one from that same ethnic group. He had 23 stores, so there was a lot of business to be had......but you had to be his bank to a degree. What his accountant would do is write and date all checks within 30 days of the vendor’s invoice. Then they would sit on the checks for 6 months and mail all of them in one batch. So once the vendor like me deposited the checks with those dates they were effectively considered paid in 30 days. Because this chain was such a big player in the area, most small vendors like myself had to go along with it because of the sales volume.

Eventually when 95% of the gift shops in central Florida were owned by this ethnic group I called it quits and went into a different kind of sales that didn’t require dealing with these people. I went to one of my few US owned customers of a decent size and sold all of my inventory at less than 1/2 wholesale and walked away. It was a hard thing to do, but I wish I had done it 5 years earlier.

Nowadays a number of checks written 6 months before probably wouldn’t even clear.

I’ve noticed in previous jobs how reliant the owners of small business could be on credit extended by vendors; I understand it, but it isn’t a good thing - as though the vendors were bearing the risks of operating the businesses instead of the owners themselves. Seemed to go against the concept that business owners should be unrestrained in their profits as they alone bore the risks.

I’m shocked at how many small businesses (delis, mechanics, liquor stores) have signs that they don’t extend credit; has it become that common for people to ask? Credit cards are pre-approved loans; have that many people maxed them out - or don’t qualify for them?