So this business owes me money....

[Tony_SS]

Originally Posted by 71camaroz27

I have done this in the past with guys that I have had to put on COD.
Tell the guy that you are going to raise his prices 10%, and keep track of his debt. Send him an email after each sale, and tell him how much he owes.

Hey "Bob" after this shipment, you only owe me $57,000.
Hey "Bob" after this order you only owe me $51,000.

Worked for me. He is now all paid up.

I think that's good advice.

[Chad-1stGen]

In your original post you said you were going to meet with the customer. Anything come out of it?

[Flash68]

Originally Posted by Chad-1stGen

In your original post you said you were going to meet with the customer. Anything come out of it?

Uh oh. An accountant is here. This spells trouble.

[Fluid Power]

Originally Posted by Chad-1stGen

In your original post you said you were going to meet with the customer. Anything come out of it?

Not yet, Friday 5/11/12. I didn't make it out there early this week. Friday is the day I normally visit since I have my largest customer right down the street. (Coke) They have drama paying as well, but that is a whole other story. I have some COD stuff to drop off that he has been wanting since Tuesday of this week, so he is anxious to see me...Full report later...

Darren

[Ummgawa]

Darren,

Someone beat me to the punch. I'd figure out how far I am willing to write down his debt (my profit margin) and amortize the remainder over 24 months of CODs. When (and if) we were caught up, I'd never ever let him get behind again. COD him till the cows come home. If he questions you on it, drop him like a used rubber.

Good luck dude.

[Fluid Power]

Originally Posted by Ummgawa

Darren,

Someone beat me to the punch. I'd figure out how far I am willing to write down his debt (my profit margin) and amortize the remainder over 24 months of CODs. When (and if) we were caught up, I'd never ever let him get behind again. COD him till the cows come home. If he questions you on it, drop him like a used rubber.

Good luck dude.

Jim,

I am fortunate in the sense that it the money owed does not jeopardize the business. It was all my fault for letting it get this out of hand. 3 good size orders and boom here we are. His last paid on account ($5k) was on 1/29/12. Everything else was COD. The real issue is what has been stated before, we can sue or send to collections and get nothing, or we can try and work it out and get our money and continue to do business. The first option we loose the money period. At least by boosting the price and working out a plan of payment, I can still get paid and move product. It is a situation that has no clear cut answer and I was really interested in what people would do or say if they were in my shoes. There has been some good advice. The situation goes way beyond what is capable of being explained here. On some items they buy, It allows me to buy a much greater discount. For example, If he buys $1000 net from one vendor, my discount goes from 50% off to 65%. That extra 15% when I place inventory buys allows some nice margins on things that are normally sold for 15-17%. Again, this is what adds some complexity to the equation. We shut customers off all the time for slow or no pay and have sued a half dozen or more and have been successful at collecting judgements on all but 1 case. This is different because I know this guy. It is like a chess match to him. He drives the Porsche, has the Rolex and runs his mouth. It will catch up, we will get paid, we always have. I am enjoying the discussion however!

Darren