No factor is so necessary in building up business as credit, and no
factor is so necessary in building up credit as truth.
It is comparatively easy to start credit, but the art is to keep
credit.
The young business man who says "I want no credit, I buy and sell for
cash" makes a mistake. It is all right to pay promptly, but do not
establish a spot cash payment basis, for later on, when you ask credit,
your creditors will think something is wrong.
Establish a credit whether you need it or not. It is a good
advertisement and a frequent help.
Be reasonably slow in paying your bills, but positively sure that you
do pay them.
When you get a sharp or blunt letter asking for a settlement, go to
your creditor face to face, set a date when you will make a payment and
keep your agreement.
Don't be specific as to amount unless you are decidedly sure you can do
it. Be specific as to date, however, and be there or have your check
there on the date.
Suppose a man owes you $100 and you ask him for it and he says "Here
are ten dollars on account, and on next Thursday I will make another
payment, and as often as I can I will pay something until you are fully
paid up." You don't get angry at that man when you see his intentions
are good and he is doing his best.
So long as your creditor gets something every time he writes it keeps
him good natured.
It is the man who breaks promises who gets hard usage from the
creditors.
If you owe more than your present cash balance can liquidate, make a
pro rata payment all around among your creditors. Write a good square
letter saying nothing would please you more than to send a check in
full, and that this payment is made as evidence of your willingness and
intention to keep good faith.
Keep in touch personally with your creditors as far as possible. Talk
to them of your plans and prospects. Always tell the truth. Have your
account as a moral risk rather than as a Dun or Bradstreet risk.
There is sentiment in business. Creditors have hearts and they have
good impulses. They appreciate friendship and especially gratitude.
Don't believe a word of that great untruth "There is no sentiment in
business."
Don't get angry when asked for money. Admit your slowness and tell your
creditor that as an offset for your present slowness you have a good
memory and a heart that appreciates, and some day your purchases will
be much larger, and those who are your friends now will certainly get
the benefit when the time comes that you do not require favors.
An honest, frank, heart to heart talk is most valuable. The credit man
keeps the truthful man in mind and his account under his protecting
wing. The credit man glories with you, and has a distinct interest in
your success when it comes.
It often happens that the small bank or small manufacturer is the best
place for the beginner to go for credit. You can get closer to the
small growing creditor than you can to the big fellow who is
independent.
The big bank is cold blooded. It insists upon security and collateral.
Your account in a big bank is only an incidental detail, and the
cashier is cold and distant and blunt.
The small bank, however, gives you more time and attention, is more
interested in you and can remember you much better than the big bank.
Avoid bad associates. You can't play the races and give wine dinners
and maintain strong confidence with your creditors.
You must be worthy of the confidence reposed in you. It is your duty
and part of the contract to be reliable and truthful.
Every time a creditor gets out of sorts go to him and pay him
something, and he will quiet down.
Be grateful. Don't be afraid to express yourself freely and frequently
on this point.
When you are caught up and financially strong stick to those who stuck
by you.
Remember, credit is based on confidence in the individual rather than
in his bank account.
Don't get into nasty arguments or disputes. Give and take. Be fair. Be
square. Keep your temper. Stoop to conquer. Cut out all thoughts of
revenge.
When a house does not treat you right, curb your temper, and, as soon
as you can, get in touch with some other good house. Tell the new house
frankly why you changed.
Credit is a subsidy, and it stands the hustling business man in good
stead.
Many men have started in business with a capital only of ability, hard
work, honesty and good reputation.
The use or abuse of credit determines whether a man will rise or fall.
Keep your record clean, and if later you get on the shoals your past
will stand you in good stead.
If you have been given to sharp practice or dishonesty, woe be unto you
when you fall.
Remember these things carefully. Keep in personal touch with your
creditors, keep your promises, pay on account when you cannot pay in
full, hustle, be honest, keep good company, don't gamble, don't be a
sport. If you practice these virtues, offers of aid will come to you
rather than flee from you.