Escape = Chargeback?

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Escapes

Wes,
Although ive heard of this before it's pretty new to me also. I guess when the time comes that it actually can apply, you take closer notice.

Marc,
That's exactly what this refers to. If it gets to them it may cost you, if it gets to thier customer, God help you!

Is this a bandwagon seeking orchestra status guys? Or is this just a company that's possible jumped on recently? How long has this been going on? By Marcs statement, quite awhile.

Thank You all for the excellent replies, much apprec.

Bob

 

[BadgerMan]

BTW, what the customer did was short pay the next invoice the amount of the chargeback.

Can you say "credit hold"?

LOL!

 

[D.Scott]

Can you say "credit hold"?

LOL!

Once you get to "short pay" and "credit hold" you may as well say goodbye to that customer. To me, it is better to lose the customer up front by taking exception to the requirement. If they insist on enforcing the charge backs, they had better have a second source ready. As Marc pointed out, the new requirement requires a contract review.

Dave

 

[Wes Bucey]

Wes,
Although ive heard of this before it's pretty new to me also. I guess when the time comes that it actually can apply, you take closer notice.

Marc,
That's exactly what this refers to. If it gets to them it may cost you, if it gets to thier customer, God help you!

Is this a bandwagon seeking orchestra status guys? Or is this just a company that's possible jumped on recently? How long has this been going on? By Marcs statement, quite awhile.

Thank You all for the excellent replies, much apprec.

Bob

Most suppliers do NOT realize how much leverage they have against a customer. If the customer is really willing to extort this concession from your company, what other vile thing will he do? It must be nipped in the bud.

When I was running (or co-running) organizations, we kept a reserve account we called formally "Forget You" account. Informally, we used the same initials for a different first word.

If a customer became too miserable to work with, we tapped the FY account to search for a new customer, even giving cash concessions to get a foot in the door.

Mostly, though, it was surprising how quickly some customers backed down from unreasonable demands when we told them, "Drop this request or we will now demand cash in advance for all shipments. We cannot allow you to have financial leverage over us. This is non-negotiable!"

The point being that once any point in the contract is changed, ALL points are subject to change, including price and terms.

 

[BadgerMan]

the new requirement requires a contract review.

Very true, and as I said above, escape charge clauses are always taken exception to in our organization.

Mostly, though, it was surprising how quickly some customers backed down from unreasonable demands when we told them, "Drop this request or we will now demand cash in advance for all shipments. We cannot allow you to have financial leverage over us. This is non-negotiable!"

This is also very true.

Once you get to "short pay" and "credit hold" you may as well say goodbye to that customer.

Not true in our case. We maintain a running list of customers who are on credit hold simply because they refuse to pay according to the agreed upon terms (contractual). Some have been on and off the list for years........that's just the way they operate. Whatcha gonna do other than demand payment in advance as Wes said?