Credit Matters Newsletter
In This Issue
- What's New At Credit Matters?
- Quote Of The Month
- Monthly Business Observation
- Monthly Business Conundrum
- This Month's Business Inconvenient Truth
- Latest Blogs & Readings
- Special Topic
What's New At Credit Matters?
Welcome to our September newsletter. The focus this month puts forward thoughts on a number of issues.
The Special Topic is about the ATO focus on collecting outstanding payments, even from those businesses which no longer operate which may have left unpaid debts owed to the ATO.
Kim is available to help with your questions and concerns if you need any assistance, and as always, the first chat is always free of charge or obligation.
Quote Of The Month
Never discredit your gut instinct. You are not paranoid. Your body can pick up on bad vibrations. If something deep inside of you says something is not right about a person or situation, trust it.”
Georgopoulos Strati Georgopoulos
Monthly Business Observation
Whilst many in management may understand the concept of listening to a person’s gut feelings, unfortunately, all too often they disregard this concept when making business decisions. The reason this happens is manyfold and includes the following:
- failing to respect another professional’s opinion when the information provided clashes with their own self-interests or ideology,
- the perception that because no dollar values can be allocated to the information from a gut feeling, it cannot be validated or useful,
- management believes gut feelings distract employees from achieving the major objectives of sales and profits,
- management often fails to appreciate how a positive response to a negative feeling can help to protect their business’s good reputation,
- management is unable to see a positive outcome rather than a negative outcome on the exposure of a gut feeling which is at first perceived to be in the negative,
- the business operates to a strict process which cannot be amended to suit a few separate situations, etc.
Gut feelings are a real concept in business. What is often forgotten is that when a potential negative factor is revealed, if viewed positively and action taken accordingly, that negative gut feeling can help save a business from a loss. For instance, many dollars are lost from a bad debt, fraud or a slow paying customer which has been identified on a gut feeling. When management takes this view, the potential profit of any given sale is often negatively compromised. Alternatively, a negative feeling identified and acted upon, may lead to a change of strategies and end up achieving a positive outcome.
Monthly Business Conundrum
All businesses face conundrums when it comes to decision making and it is a constant battle to make the right decision. Here are only a few examples.
- Employ ever more technology tools thinking they can replace human employees when dealing with customers. History shows us that this thought is not always the best.
- Customer service is not just a fuzzy, and warm feeling term. It is a costly upfront business asset to set up properly, yet if done correctly, leads to many dollar savings or rewards later.
- Verifying that technology tools are always fit for purpose, or failing to beta test new IT tools to ascertain whether they actually produce the information required to justify their use and cost.
- Failing to understand that technology tools may solve some problems and yet also create totally new types of problems for which your business has no immediate knowledge or available finance to resolve.
- Thinking that cash in the bank account is a poor use of this asset resource. Again, history shows us that this ethos is not always correct. The fact is however, cash and savings often provide benefits that using debt can never offer.
- Believing that all debt is good and essential for the expansion of your business. However, debt can be extremely costly in the long run. More importantly, debt hands the financier a greater level of control over your business that is often not anticipated.
- Understanding that all invoices will not be paid within agreed terms and that every invoice raised is always an asset, when in fact, many are nothing more than a future liability.
I could go on and on how the number of conundrums that are possible which all those who own or manage a business will encounter in their respective business journeys. The main concept to understand is to be aware of the possibilities of these conundrums and always work on making the right decision for the long term of your business
This Month's Business Inconvenient Truth
Completing cutbacks is a bit like thinking using more technology will resolve all your problems. As we know when we focus on thinking that technology will solve all our problems, we often find it doesn’t, it just creates new ones. Focusing on cutbacks may reduce one set of costs, however, we often find it increases costs in other unforeseen areas.
The reality is that cutbacks and operational reviews are worthy pursuits to assist businesses improve their cashflows and profits. The problem comes about when either operation is completed based on ideology, or to achieve other management objectives. In these situations, the positive results sought, are inevitably compromised with negative outcomes.
The perfect example is using technology indiscriminately instead of experienced people in regard to customer service. In my view, any matter raised and not resolved immediately, or within 24 hours, is a potential problem. As history shows us, when customer needs are not satisfied immediately, they seek buying options with your competitors, or slow pay your business’s invoices because a query was not answered adequately.
If you think such examples are not common, think about your own dealings with your own customer enquiries with suppliers. Do you hang around waiting indefinitely for an answer or feedback on a desired purchase? I think not on average. You move on until your needs are satisfied, and so do your customers and suppliers.
As for Chatbots and their answers to questions, don’t get me started.
At the end of the day, you can cut costs either by a cost cutting exercise or a proper review of your operations. Failing to complete either exercise properly, will only lead to unforeseen costs and a negatively compromised outcome overall.
Latest Blogs & Readings
The ATO is currently working on debt collecting and looking for all your secrets. I suggest that business owners and managers would be wise to seek professional help if they are not aware of the ATO’s new strategies about dealing with unpaid debts owed.
Credit Matters is a financial risk management resource centre for the Australian business community. If you are in business, Credit Matters is your ideal source of financial risk management solutions.
Future Opportunities & Possibilities
Credit Matters is continuing to grow and provide marketing and knowledge about financial risks to the Australia business community.
Futhermore, we invite marketing and knowledge ideas from our readers and contributors on how we can assist our respective firms grow. If you have any ideas, please contact me at info@creditmatters.com.au.
If you are interested in finding new ways to reach your marketplace, why not try Credit Matters. Our prices for advertising are very reasonable and advertising packages are on offer to make any cost, even more affordable. So if you are interested in reaching your customers at the right price, please contact Kim at info@creditmatters.com.au for options.