The fight against NET30

wheelieking71 · Jun 3, 2016

Well, I hate NET30 terms.
I realize, I am absolutely nobody in the big-picture. But, I don't care.
I am doing my part, and standing my ground.

I had another customer today, that wanted me to run parts. At what he considers a high volume, to keep his prices down. (A whopping 36pcs)
And then, "buy them from me as he needs them". Yea, seriously. Not exactly NET30. But, not COD either.
Probably worse that NET30 when you think about it.

Now, this all went down as he was picking up parts I had already ran. I kind of knew the discussion was coming.

My reply was pretty much "I am a machinist, not a banker". To which he pretty much just couldn't understand how I could run my business that way.
Said "I could see if we were talking 10's of thousands. But, this is chump change" (kind of self derogatory actually! LOL)

I wanted to tell him, if I have no business running my business that way, he has no business ordering parts he can't afford to pay for.

But, I just shut my mouth. Took his money, gave him his parts, and said "have a nice day".

I may slit my own throat yet. Oh-well. My point: do it your way! Don't conform, or they will walk all over you.

Monarchist · Jun 3, 2016

wheelieking71 said:
Well, I hate NET30 terms.

NET 10 has existed since forever-ago. Also 2% 10, NET 30.

Not a damned thing wrong with COD when the job is nuisance-level. Small enough billings, I've had US GOV *request* to be put onto COD. Grossly simplified THEIR paperwork and costs.

In yet-another life, it was Consulting, not machining, but just as much a whore's game, yet 30% up-front or we didn't start.

I realize, I am absolutely nobody in the big-picture. But, I don't care.
I am doing my part, and standing my ground.

No. You matter. Your shop, your rules. One just has to cut a break to those who have proven they DO pay and DO NOT jerk you around over cancellations, late-in-the day changes, etc.

Put 'em on a formal 'good customer discount' even.

FWIW. a 'walk in' isn't entitled to 'open account' terms to begin with. of ANY 'dating'. Must have - and offer proof of - established credit with the rating agencies, or build and establish track-record with YOU.

Have you been 'too easy' earlier-on? A smallholder doesn't have to kiss ass. You don't have TIME for that if you would do.

Just has to have a 'system' to encourage each customer to FEEL as IF he's had 'special' service and figure it is a good place to return to for more of it.

If it pisses you off? Smile at the customer. Go explain the stress and aggravation - patiently - to the dog. Any well-treated Dog will give you back wise counsel. Always. Part of their work-ethic.

Cats? Or Women? Nah.

They just don't give a shit.

Bill

m98custom1212 · Jun 3, 2016

Some of my vendors (material and otherwise) want me to be "Credit Net 30 or whatever" I always paid credit card over the phone..they're saying I will get better pricing if I open credit account with them.

Monarchist · Jun 3, 2016

m98custom1212 said:
Some of my vendors (material and otherwise) want me to be "Credit Net 30 or whatever" I always paid credit card over the phone..they're saying I will get better pricing if I open credit account with them.

You'll certainly get more harassing junk email and brochures. Nothing else is certain, not even faster handling of the order.

wheelieking71 · Jun 3, 2016

m98custom1212 said:
Some of my vendors (material and otherwise) want me to be "Credit Net 30 or whatever" I always paid credit card over the phone..they're saying I will get better pricing if I open credit account with them.

Personally, I would never do it.
I get "credit inquiries" from places all the time, asking how certain customers of mine pay.
Apparently these customers are trying to set up credit accounts with their vendors.
This approach is NOT for me!

Part of the reason you get vendors asking you to set up an account is because it takes some of the responsibility off the sales person.
Rather than run your card, they just pass the invoice on to the billing department.
This does two things. It speeds up the counter. And, it avoids a lot of credit-card fees.

I personally just whip out the AMMEX. Not to give me my own "NET30" situation (I would prefer to pay it daily if it wasn't such a PITA).
But, simply because I don't want to carry that much cash. And, writing checks is a PITA.
It really is mostly for the convenience factor. It also makes it easy to track spending.

Monarchist · Jun 3, 2016

wheelieking71 said:
I personally just whip out the AMMEX. Not to give me my own "NET30" situation (I would prefer to pay it daily if it wasn't such a PITA).
But, simply because I don't want to carry that much cash. And, writing checks is a PITA.
It really is mostly for the convenience factor. It also makes it easy to track spending.

That works. 25 years back a 6+ billion USD Day Job put their whole procurement AND travel & lodging expense system onto a tailored Diners Club plan. Got analysis to the minute if they needed that, and cut a significant chunk out of their admin costs.

Either way you run it, administration is overhead to the business of metal-molesting.

Actually wants a whole 'nuther 'personality type' to do each of them well.

There's where your aggravation arises. Again.

You just AIN'T a natchral born bean-clerk, no matter what 'system' you use.

Bill

TangentCNC · Jun 3, 2016

No terms here, not on 50 piece orders, not on 4000 piece orders. I do 50% down, remaining 50% before it ships or before it gets picked up.

HuFlungDung · Jun 3, 2016

I have to wonder if for the most of them, the ignorant customers really don't think we're doing much...just kind of standing around in the shop....not really working for our $$, and so, why would we ever mind giving credit, since, after all, the money comes so easy to us

Hell, if only they had a few tools, they could do all this shit after supper themselves, out in their garage.

It is our duty, in support of our trade, to charge 'em hard, and charge 'em plenty, make 'em mad so they all go out and buy their own shop full of tools....because....it's sooo easy to do if you just got a couple of tools.

I was talking to a fellow about setting up a new shop, he says, 'yeah, the tools are nothing, you can buy them cheap and get what you want to start up anywhere'. Yeah, I thought, that's what people say who never saw the shitload of accessories you need laying around to do the 'simplest job'.

CarbideBob · Jun 3, 2016

m98custom1212 said:
Some of my vendors (material and otherwise) want me to be "Credit Net 30 or whatever" I always paid credit card over the phone..they're saying I will get better pricing if I open credit account with them.

Do you take credit cards as payment?
If you do you will realize why you can get better pricing on a open account.
You don't think these instant payments move through the system for free do you?
Bob

Ries · Jun 3, 2016

I used to sell to big retail chains sometimes- Crate and Barrel, Nordstroms, Neiman Marcus- and they were usually net 90.
From the date they got the shipment, not the date I shipped.
But they were 900lb gorillas, and I had only two choices- wait, or dont sell.
Same thing with many government agencies- net 30, but they only run checks once a month sometimes, which means, often, net 45, sometimes worse.
If it was easy, everybody would be doing it.

So net 30 doesnt seem so bad to me.
Which, usually, really means net 45.

In terms of buying stuff, I have had wholesale accounts with companies since the early 80s- in those days, most wholesalers just plain would not sell to you if you didnt have an account. Of course, you could pay sooner, but why?
I still balance my purchases of thousands of dollars worth of materials, with expected checks that are slowly wending their way thru my clients accounting systems.
So, as a buyer, I use net 30 to my advantage, have for years.

Its how american industry ran for 80 years or so- its only this newfangled internet shit that makes it possible to buy stuff direct from manufacturers, without regional exclusivity, local dealer preferences, $500 minimum orders, and full financials on file. Thats the way it always was.
And still is, for some things- I still run into companies that will only sell thru their local distributor, and they will only ship, snail mail to that distributor, when he places his monthly order. I am waiting six weeks now on a plasma torch from Thermal Dynamics, due to that antiquated 20th century way of doing business.

sealark37 · Jun 3, 2016

When, and if, he ever comes back to purchase the rest of his "order", take his money and then decide if you want to do it again. My guess is that he will want a better price on the rest of his parts. Regards, Clark

adh2000 · Jun 3, 2016

Not sure why you are complaining about Net 30. People, even accountants, have jobs to do and are busy. Someone comes in wanting to be paid immediately because he just finished the job its a big pain in the ass frankly. I have to go talk to the accountant, she has to drop whatever it is she is doing and cut a check for some amount. Do we have an ivoice? Is the invoice approved? Well now I've got to get the project manager to drop whatever he is doing and approve the invoice. Get the picture? Just like machining bookkeeping happens according to a process. Demanding immediate payment is no different than someone walks into your shop and wants you to drop everything and drill a 1/4" hole in a piece of angle iron. Think that might make it hard to get things done? Might that get irritating after a while? Submit your invoice and we'll process it in the next billing cycle.

Alan

Philabuster · Jun 3, 2016

m98custom1212 said:
Some of my vendors (material and otherwise) want me to be "Credit Net 30 or whatever" I always paid credit card over the phone..they're saying I will get better pricing if I open credit account with them.

They do it to try to entice you into doing ALL your business with them, be it Home Depot, Amazon, Lowes, etc. Sign up now and get XX% off your first purchase...

This way, you will be much more inclined (read forced because you are broke) to shop there and use their credit, regardless if the shit is cheaper or better elsewhere.

TangentCNC · Jun 3, 2016

adh2000 said:
Not sure why you are complaining about Net 30. People, even accountants, have jobs to do and are busy. Someone comes in wanting to be paid immediately because he just finished the job its a big pain in the ass frankly. I have to go talk to the accountant, she has to drop whatever it is she is doing and cut a check for some amount. Do we have an ivoice? Is the invoice approved? Well now I've got to get the project manager to drop whatever he is doing and approve the invoice. Get the picture? Just like machining bookkeeping happens according to a process. Demanding immediate payment is no different than someone walks into your shop and wants you to drop everything and drill a 1/4" hole in a piece of angle iron. Think that might make it hard to get things done? Might that get irritating after a while? Submit your invoice and we'll process it in the next billing cycle.

Alan

That check has to be cut at some point in time. The job takes at least a week or longer unless its a rushed gig...so shouldn't you have your check cut before you get ready to pick up parts? Sounds like a sorry excuse to not pay for an extra 30 days. Demanding immediate payment would be wanting the full amount up front before work is to be started.

Monarchist · Jun 3, 2016

TangentCNC said:
No terms here, not on 50 piece orders, not on 4000 piece orders. I do 50% down, remaining 50% before it ships or before it gets picked up.

As a customer, I'd rather deal with folk like that.

Vendor who sticks to that is more likely to be able to deliver on time and on-spec than be making excuses on already overdue goods 'coz they can't afford the metal or tooling until one or several prior fools pay a few bucks each on THEIR accounts.

Any of these if-comers ever claim they shouldn't HAVE to pony-up because they fill a grocery cart on NET 30?

They do that alright.

Credit card company's rice bowl to make it possible though.

Bill

spaeth · Jun 3, 2016

I do business with 2 large corps. One pays net 60 the other
net 90 days. When they started that policy I thought to fish
in a different pond. Instead I added a small percentage to my
quotes and continued to do work for both. After a while I got
to like being able to see what was coming in and adjust my
spending accordingly. I use the cash method of accounting so
it's no big tax issue. I've never been jammed by either one
and they do butter the bread regularly. I will make some items
to keep on the shelf based on their history and that's pretty
handy too. I would not do that for a once in a while customer,
those guys are COD please cause I'm not a bank either.
My policy is to follow an old unwritten Proverb:
Blessed are the Flexible...For They Shall Not
Get Bent Out Of Shape.
Self Employment has been quite an adventure.
spaeth

wheelieking71 · Jun 3, 2016

Monarchist said:
Vendor who sticks to that is more likely to be able to deliver on time and on-spec than be making excuses on already overdue goods 'coz they can't afford the metal or tooling until one or several prior fools pay a few bucks each on THEIR accounts.

That is what I found ironically HILARIOUS about this mornings "discussion".
The whole reason for his request of a purchase as he needs arrangement, is because he hasn't been paid yet, and wont get paid for at least 30 days.
To which all I can say is: "OHH REALLY?!.......LOLOLOL!!!!!"

And, all he can say is: "its just business. That is how business is conducted."

All the while I am thinking: "my shop my rules. I am busy. I don't need you. You need me."

If I wasn't busy, rather than work my ass off for a big IOU followed by a long row of question marks, I think I would rather go fishing.

Monarchist · Jun 3, 2016

wheelieking71 said:
think I would rather go fishing.

BTDTGTTS. Bait dies and stinks. Fish ain't much more durable. Line can cut yer hands, reels snarl. Hooks get inta skin. Insects won't leave yah alone.

Nah.. too much like work.

Watcha wanna doo for relaxation is mosey out inta a nicely-organized machine shop... and make something no one has asked you for at all that won't be sold or billed. Funny-looking clamp for yer own use. Or to give away at Christmas..

Just because you can.

And the arseholes wanting you to take up lending money as a sideline CAN NOT. Ever.

Bill

..

baran3 · Jun 3, 2016

I worked as a machinist at a rather large shop one time. At the end of my first day I waited outside the office. Eventually someone came out and asked why I was standing there. I replied, "well I am waiting for my payment for the time I put in today". That person told me I had to wait until something called "payday" and get this... I wouldn't even get paid this "payday" because on "payday" employees are paid for work they did LAST week!!!!! They said that was just the way things work. Last day I worked there......

PDW · Jun 3, 2016

Monarchist said:
BTDTGTTS. Bait dies and stinks. Fish ain't much more durable. Line can cut yer hands, reels snarl. Hooks get inta skin. Insects won't leave yah alone.

Nah.. too much like work.

Watcha wanna doo for relaxation is mosey out inta a nicely-organized machine shop... and make something no one has asked you for at all that won't be sold or billed. Funny-looking clamp for yer own use. Or to give away at Christmas..

Just because you can.

And the arseholes wanting you to take up lending money as a sideline CAN NOT. Ever.

Bill

..

Ha ha ha. I live on the waterfront in one of the least spoiled parts of Australia. The bay out the front is full of fish and leads into waterways with even more.

I spend most of my time in my machine shop. Working on my own projects for the most part, occasional customer who's referred to me by a friend. They pay on pickup. Fishing is boring. Too often, wet arse, no fish. I have a very low boredom threshold, I'd want to be plinking cans or something with a 22 pistol after 15 minutes. Problem is, I'm not allowed to *have* a 22LR pistol

Not that I don't provide terms, I do. To government bodies, for software development that doesn't involve me laying out capital in advance. Exceptions being packaged hardware/software when I mark up the hardware to cover the time value of money and tell them I'm doing just that. They don't care.

EOFY in a few weeks, Govt bodies are hassling *me* to invoice them so they can spend the money before the books close. I like this time of year..... the toy budget gets a healthy boost.

PDW

The fight against NET30

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