Stagflation is a word that hasn’t been heard since the 70’s but the word popped up 562 times in major newspapers and wire services in February 2008 compared with 12 times in February 2007. Do you know what it means?
Stagflation is a combination of the words inflation and stagnation and is a term used to describe a period of inflation combined with slow economic growth, rising unemployment and can include recession. Sounds like our world!
As prices rise and more people lose their jobs, homes and income, we enter into a scary time for consumers and business owners everywhere. Food prices, fuel prices, student loans, you name it and we can’t afford it.
How can your customers afford your products? Is your product a necessity? If not, you need to be creative in ways to make more sales to make more money. If you can’t make more sales, do the next best thing and collect all the money that is owed to your company.
Print out you’re A/R report today. Sit down and call every customer that is past due, if you get an answering machine, leave a message and send a letter. Use a form letter, and make a list of the accounts that you will send a letter to and do that AFTER you finish calling everyone on you’re A/R list. This may take some time depending on the size of your business and how much credit you have extended. It is worth it, these are sales you have already made and need to be paid for.
Be very careful extending credit. My boyfriend owns an automotive shop and the tool trucks, MAC and SNAPON are no longer offering “starter” credit to mechanics. Their policy up until last week was to offer mechanics with little or no credit, a starter credit line of $2500. Not anymore, there is no credit given unless you have an outstanding credit record.
Look for this to start happening across the board in every industry, if it hasn’t already.
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