How to Negotiate Effectively With an Essential Vendor/Creditor
Just as the economic crunch hit hard in Florida, a client there approached me with a dilemma. She owned a restaurant and was behind on paying her main supplier. Things had gotten so tight the supplier was refusing to make any more deliveries until the account was paid in full. Without this weekly delivery, however, she couldn’t create the meals to sell to raise the money to pay the creditor her past due balance. She had run out of ideas and was seeing the creditor as her enemy.
The truth is, your creditors are your friends and allies. They’re the ones who make it possible for you to run your business. The trick to negotiating effectively with a vendor or creditor who is thinking of cutting you off, is to help them see what’s in it for them. This strategy won’t work with big corporations, like your cell phone or your electric company, but it will work with smaller vendors.
Here’s the bottom line. If you default on a small vender, they don’t get paid. If you’re out of business, you can’t pay them. It’s in their best interest to help you stay in business, which helps THEM stay in business. Giving your creditor a solid strategy to say yes to you is the key.
Start the conversation by letting your creditor know that your intention is to pay them in full. Then let them know that you can pay the current bills as they come in. And as long as you can continue to get deliveries, you can also start to pay them the past due amount. If you can’t get new deliveries, you’re out of business, and that makes it difficult, if not impossible for them to get paid what they’re owed.
Again, reiterate that your number one goal is to get them paid off. And that you need their help to accomplish this. Then propose a repayment plan. Agree to pay cash on delivery for all new products. And to pay a small extra amount of $25, $50 or $100 a month to get the balance of what you owe them paid off. Any smaller vender with even a tablespoon of common sense will say yes to the deal.
Let us know what’s worked for you by leaving a comment below!
Paula Langguth Ryan is a mediation and marketing maven, specializing in financial issues for small businesses. She’s the creator of the Supersonic Prosperity Oriented Copywriting System http://www.paulalangguthryan.com/shop/supersonic-copywriting/ and provides strategic financial consulting services to small business owners. She’s also the author of Bounce Back From Bankruptcy: A Step-By-Step Guide to Getting Back on Your Financial Feet and the forthcoming Break the Debt Cycle – For Good! You can follow her on Twitter at copytamer and get free resources at www.paulalangguthryan.com. If you need help or assist please email us at firstname.lastname@example.org.