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Written by Richard Weisgrau
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Saturday, 19 May 2007 |
 Originally published as Chapter 13, in the book titled The Real Business of Photography , Allworth Press, NY ISBN 158115-350-3
Checking Credit
A great way to avoid deadbeats is to check a prospect’s credit. I have been surprised at the number of photographers who will complete an assignment for a prospect for whom they have never worked before, is in a different part of the country, or they know practically nothing without checking the credit worthiness of the prospect. There are five ways to check credit. One of them costs money. The others only take a little bit of your time.
A basic credit report can be obtained from one of many commercial
credit-reporting companies. Basic credit reports can be acquired over
the Internet and cost as little as eight dollars. A Web search under
the heading “company credit reports” will produce a number of companies
that offer such services. One company, Collection Industry™ can be
found at www.collectionindustry.com . It offers a variety of reports, which vary in detail and prices vary accordingly. D&B™ at www.dnb.com
is another supplier, and it offers a collection service too. You should
investigate and evaluate different services before you need them. Then,
when some company asks you to lay out thousands of dollars in time and
money to do work for them, you will at least know something about the
level of risk you are taking by having a report on their credit history.
Credit references are a good way to check payment habits (not credit
history). When you seek credit at a local supplier you will normally
have to supply credit references of other businesses that have already
given you credit. That is an everyday, normal request. You may not want
to ask the buyer for a credit reference, but you can ask the accounts
payable department, which normally handles such requests. The problem
with such credit references is that companies generally know which
suppliers they are not paying on time, so they are unlikely to give you
those names. Still, it is a good idea to check. Sometimes one supplier
knows what is happening to another by virtue of the commercial
grapevine.
Peer credit checks are also a good idea, and easy to make. They amount
to contacting other photographers who have worked for the company. You
can ask your contact for a couple of names. Be honest about why you
want them. Any person you call could report your call back to the
person who gave you the name. You can put out a request for information
on photographers’ Internet bulletin boards and e-mail list services. Be
sure to word any such request carefully to avoid any liability. Here’s
an example of a request for credit information:
“I have been asked to do some work for (name of company), which is
located in (city, state). If anyone has had any dealings with this
company would you please e-mail me at (your e-mail address).”
The message is worded in a manner to discourage any negative replies
online. You do not want to initiate an Internet discussion about a
company, if negative things might be said about it. That is not to say
that replies will be private as you asked them to be. But you will have
asked properly, and if the person replying chooses to go public with
negative information, it is their choice. You asked for a private
reply.
If you are checking on a local company, you might be able to find a
local photographer or two who has worked with the company, depending on
how deep your peer network goes. If you belong to any local
photographers’ organization or chapter of a national organization, you
should be able to ask at one of its meetings, assuming the scheduled
date of the meeting is compatible with your need for information.
Advances
If you are working with a company whose credit worthiness is
questionable, you should consider asking for an advance payment. An
advance on fees and expenses is best, but at least an advance for
expenses is in order. That way you only risk a loss of your time and
not of money spent to buy materials and services to compete the job.
Getting advances from poorly funded companies is not easy. Companies
that cannot pay their bills on time are unlikely to have the money to
make an advance payment. Obtaining an advance on fees is not easy. You
have neither done work nor delivered any product. Yet asking for an
advance or a partial advance on expenses is reasonable especially when
the expenses will be substantial. You are a small business and your
ability to finance the expenses of a larger business is limited. You
can make a reasonable argument for an expense advance. If your request
is turned down, it might be a reason to exercise more caution from that
point forward.
Go to Part 8
(c) 2004 Richard Weisgrau [contact] [bio]
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Last Updated ( Saturday, 26 May 2007 )
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