JPD Mom

Summer Vacation & Then Some

July 27, 2009. August 9, 2009

"Hey Jamie, the Economy has your business way down, sales are 1/2 of what they were a year ago and you let go some employees, which means you are doing a lot of jobs you did not used to do.  What are you going to do now?"

"I'm going went to Disneyland!"

Cue the song, "When you wish upon a star....."  Fade out to Jamie and her family riding off happily ever after on Cinderella's carriage.  Jamie (naturally) will be wearing a princess gown and or crown, waving her princess wand to the crowd.  Ya, right....but I did get to go to Disneyland!

Not that we did not have a great time but Disneyland in the middle of summer is hot - which I knew, yes but I was hoping it was not thathot.  It was a great way to let loose, act like a child and um, well - let's just say I am really happy that I keep good care of my teeth and body and that I have some edumacation.  If just one more lady (or man) came towards me in their scooter and tried to pretend they did not notice almost running me and my children over I was going to go rambo on their ass ahem....not really - but it was bad.

Everybody Needs a Break

Yep that's right, even in the worst Economy we have seen in years, or my adult lifetime (that I owned a business that is) we scraped our money together and went to Disneyland.  We had not been in 4 years, and I amwas excited.  We closed down JPD for a week...no worries, we worked the weekend we get back to ensure everything ships on time, and we still ship when I am out of town (JPD is sort of like the happiest place on earth, I just sprinkle a little pixie dust around and magically everything falls in to place - snort!).  Pssst....our shipping clerk and the woman that does our ribbons is not going on vacation with us - that is our pixie dust that keeps us afloat.  Me loves them two people something awful.

I have not blogged in a while - a long while.  No apology.  Just a fact.  I have actually been enjoying the summer and reading almost anything I could get my hands on.  Twilight. Check. Jen Lancaster. Check. Julie & Julia. Check. Better Home & Garden, Sunset Magazine, Pottery Barn.Check, Check and well - just browsing. 

It is funny my business books and my Entrepreneur Magazines have been stacking up, but I don't really care.  We are coming up on year seven this November and truth be told I am not really in to reading anything about people in business.  It has made wonder if the thrill is gone?  I know it is not because I know everything there is to know about running a business - I am just not wanting to read about business....Maybe I will again, I am sure I will - but it is like, "Why bother?"

Working on....Everything

• I started this JPD Facebook Fan Page  a few weeks, or months ago - I can't keep track.  I am not one to peddle it to all my friends quite yet, but I will once I get a handle on it and fix it up.

• Designing a new website.  It has been I think 5 years since we had this done - maybe longer.  Last time we had a friend design it - now I am helping out.  We need to do it, and it is not my strong suit at all - Graphic Design....not so much.

• It's Christmas time again.  I need to work on Holiday Products soon....

• My kids had no camps, nothing this summer.  We shuffled them around between my husband, my parents and many playdates.  It was actually really nice and relaxing and we slept in more times that not.

Predicting the Future of the Economy?

So, I don't think that I am an Economist or a person that follows the stock market and predicts trends - I mean I positive I don't know how to do either of these things.  However, something is happening at that has everyone (all 7 of us...or 8 if you count my husband, wait 10 woo hoo my kids worked today also) is starting to look up.  Something is in the air or the money is starting to flow again.

And it Always Comes Back to Name Tiles

Seven years ago almost to-the-day (my daughter just turned seven) I came up with the first Name Tiles for her room...I know you have heard the storybefore.  Blah, Blah our flagship product - nothing like it before, themes ceramic, personalizing a child's room.  Any hoo, in the last two years our sales for this particular product have started to slip.  And they really started slipping this year. 

In a normal year and with hundreds of channels we would sell anywhere from 100,200 even 300 a week during the Holiday Months - Name Tiles that is.  Hundreds of Name Tiles sold a week.  This year - 26, 14 or the worst week ever 7 Name Tiles sold in a week after the first of the year.

Some people might keep this information close to the vest, not me.  I have no problem admitting that our sales have been down.  Some products have spiked, others not so much. I am more proud that we are still in business and seem to have weathered the worst of the Economy-Recession-Storm.  Anyhoo....for about a year and a half we have noticed Name Tiles slipping, and slipping alot.  Until two weeks ago.

We picked up a new store in the midwest and we had a big week.....well a big week for this Economy.  We sold 99 Name Tiles in one week, all of a sudden sales were up.  This week I think we were in the 70's.  Our Birth Tiles and Name Plaques have stayed steady week after week - not great, but steady sales.  The thing with the Name Tiles that makes this so relative is that they are our most expensive product. 

The Name Tiles retail for $13.00 a letter, and we have a minimum of 3 letters.....they are an extravagant decoration for your child's room.  Not crazy pained mural wall hanging for thousands of dollars crazy, but still our high end product.

This may be a fluke, this may turn right back around, wait or go bad next week - but for now I am taking it as a sign.  Three weeks in a row of heavier Name Tiles sales....I think I may be able to see the light at the end of the tunnel. 

Also, I am sort of (okay really) proud of the fact that we have been able to survive on so little - I mean we are surviving this, and I am hoping we will come out of it leaner, meaner and a smarter business.  And if that does not happen - I can always sell tile on the side of the road thing. Right?  I am right? I hope....

I Will Survive

January 27, 2008.

How does the song go, "First I was afraid, I was petrified, just thinking how I could live without you by my side.......just thinking oh so many night of how you did me wrong" you get my drift right?  I will survive without the big and the small accounts that do not pay me, or um steal, or refuse to pay me.  I am not going any where.

Hang In There Baby !

Woah....that last post was good to get off my chest.  I am very thankful for all the support, well-wishes, karma, tweets, Facebook support and even that one person who was willing to beat up the people that aren't paying me.  No need, really - a black eye won't put money in my pocket.  It is good (and bad at the same time) to also hear that there are so many others that know what I am going through. I really wanted to keep up the positive attitude and to keep my chin up - but this is reality folks.  I am humbled and sad that so many entrepreneurs "get" what I am going through - at least I am not alone.

When the money stops at the top, it stops all the way down to those of us that own a  small business.  Anyone in the wholesale business understands that you never get paid by everyone on time, but when a lot of our top channels don't pay and sales are bad, I can not and will not be the bank.  I am in business to make money - not lend it.

As I have stated earlier, I am not going down without a fight - as long as people still want to purchase my products - I will still sell them.  Maybe off the back of my pick-up truck at the Flea Market....no gosh I hope not, I am kidding.  I have other options.  Here are some possible ideas for those of you (and for me) that are in my boat:

Show Me The Money

As of February 1, 2009 Jamie's Painting & Design will only ship products that are paid for.  We drop ship which works when people pay their bills, those days seem to be in the past.    We have carried companies for months until we were paid.  Not anymore - no wiggle room.  Best quote ever about selling wholesale came from Pamela Barsky, "If I dropped every company that did not pay on time I would not be in business" - it is just the nature of the beast.  In this Economy I am not willing to carry over $5000 for companies that may never pay me.  I can not wait 90, 120 or forever for Company X to send me a check....

Back to reality - if you use a credit card great I ship your product.  If you pay net 30 - tell your customer how long it will take and why.  That is it- I am done playing Mr. (Mrs.) Nice Guy - I am done.  The sales channels get the money up front, me I wait 30, or 60 days....or I never get paid.  My taxes this year....not pretty.*

I am usually not so hard on any one part of my business - I usually make exception, bend the rules.  Those days are over...when dealing with money that is.   

*Just so we are clear I would like to make it very clear that not ALL my channels do not pay.  Some I have been with since the beginning of time, some for a few months - and never had one problem.  I would say the majority have been fabulous....just like in life though a few bad apples can spoil the bunch.

Diversify Your Funds

Ya, ya I know this is not about funds but you could spread yourself (and business out).  Now is not the time for an ego or a  "um I am sorry I do not do that" - uh , yes you do.  My creative cap is on and I am entertaining lots of different products, ideas - even partnerships.  To stay alive now I need to Do It and do it well. 

• Do favors, take special orders, those companies that stayed alive in bad times tend to not only survive but succeed in the future. 
• Do not let your ego get in the way of making a buck.  I am not saying you should do things you do not believe in, or jeopardize what you and your company stands for - but do not get all uppity now.  Everyone is struggling.
• Do make the hard decisions now, before someone else forces your hand
• Do keep your head up and your eye on the ball or the money...whatever - stay focused
• Do stay positive

Call me crazy, call me optimistic but seriously if you can stick with it for what, 11 more months??  The latest report say that we should be out of this Recession in 3 months - that is not too long.

Where Can you Squeeze?

If you rent space (like me) you have the problem of paying rent (and probably employees).  Though it is not ideal we have considered renting out my front office - no, not my dream - but better than going out of business.  We are not ready for this - but it may become a way to keep money coming in when my channels are not paying.

• Do you have extra space? 
• Can you rent our warehouse space? 
• Can you share with another growing company?
• Can you re-negotiate your lease?  Can you get out of it?
• Can you move the business back in your house? 
• Can you cut back on office perks?  

Those of us that are small business owners get it - there is a reason we are small.  We are mostly lean mean machines - yet we survive, we are able to make it work.  However, when you are so lean you are already at your wits end - and then to have the trouble we have now.  It can be hard, but you have to prevail, you have to get by with less - no one ever said running a business was glamorous.  I do try to pretend it is though.

We have a huge warehouse in the back, where we do our shipping, make tiles, etc.  We moved things around - created some extra space - and rented it out.  Not ideal, sort of an eye soar.......but every time I see it all I think of is "cha-ching".     

Hate to Say it....Everyone can be Replaced

I found this out the hard way - as most of us do, I was replaced (more than once).   I have been on both sides of this fence, the one being let go and the one letting someone go.  I empathize with both - I understand how tough decisions need to be made.  And, well the big guy making the big bucks....no that is not describing me - but he makes the tough decisions.

I hate to write this down, but it must be said.  Companies large and small are laying off people - it happens.   We have all experienced it, either by watching a parent or ourselves, a friend or a spouse lose their job.  It is a blow to your ego that takes a while to get over. It is horrible, it sucks and I know from first hand experience and as a child watching my father get laid off.  It can suck all of the energy out of you and make you believe you are not worth of the career you chose.  However it means staying in business or closing up shop:

• Can you scale back your employees hours? 
• Is a pay cut out of the question?
• Can you combine two positions into one? 
• Can you find work for another employee? 
• Can you cut your pay back?
• Close business on Fridays?  Mandatory days off?

No fun jobs, tons of work - but do you want to be able to sleep at night.  Having empathy for your employee that is being laid off is key, and trying to help them through it is human.  If you can find a way to not do it - good, if you have to do it -be nice.  Remember we are all human and sometimes we all need to break up.

Know When to Fold Up

I hate to say this but uh....running a business is not for the weak of heart or anyone with a thin skin.  If you are not a 100% committed, now is the time to cut and ship bait - oh wait ship and cut bait?  Whatever the saying is, if you are not ready for this tough year ahead, or if your heart it is not in - worse if your family can not afford the sacrifice - don't do it.  Now is not the time to make everyone around you suffer.  I am not being negative - I am being realistic.  I would like to think I am a sarcastic realist, instead of a negative pessimist.  You have to be willing to make the tough choices, sacrifices and go without.  If your heart is half in it.........really, why bother?

Me Me Me & My Company

My heart is still in it - I still choose to fight.  I have other options.  I am going to do whatever it takes (legal people - give me some credit) to make sure Jamie's Painting & Design survives.  I will cut back, I will make more adjustments and I will have no problem with it.  I do not think now is the time for me to get all um, big headed or "Jamie don't do that" on ya'all - I can scrub a toilet, ship a package, call a sales rep, do a produt sketch, call a sales channel and empty the garbages in one hour.    At this time I will do anything to stay alive. 

Good luck to everyone - I hope my suggestions (and solutions for my business) help you out....anyone have any other ones....send 'em over please.   Pretty please... 

The Elephant in the Room

January 22, 2008.

We Need to Talk

Okay, so I have not really wanted to talk about it, I admit it.  I have been acting like a man, a boy, a dude - if I ignore it long enough maybe it will just go away.  I am guilty as charged, I have not addressed the problem head on.  I tried to....really I did.  The times I wanted to "talk" about it though you were always like talking about something else, or I could not put my emotions into words.  So, I have pulled or more like ripped the band aid off and I am here all naked............no wait I DID not mean that - I mean raw, or vulnerable....yes I am ready! 

My Background

On a side note I must say that this reminds me of the time I got dumped, and I mean dumped with a capital "D".  When I was in college I dated a boy ( he was so not a man) who had his heart stomped on and spit out by his ex-girlfriend.  He thought he was finally ready to date again, and he picked me......oh how I wish he picked someone else.  We dated for like 4 or 5 months, I was quite taken with him - he treated me super nice, was not hard on the eyes and well I thought I was in love. 

Fast forward to the end of the relationship when he seemed to have quite the wandering eye, enjoyed spending time with anyone else but me and I found him flirting with my friends on vacation.  So, while I was in some um, sorority meeting thing I get a voice mail message; "we need to talk...but not tonight, later maybe another day."  Me being me, Ms. Won't take no for an answer and insist we talk now - I needed to know what was going on.  I drove to his apartment and he sits me down on his couch and utters these now infamous words, "Remember when I said I loved you?  I lied."

Yep - try to swallow that one down.  What a painful pill that was to take.  Years later I have told that story multiple times to many women and I am actually able to laugh about it.  I mean it makes a great story, right?  Some friends from college will back me up and confirm that actually happened - I love me a good story, but I could not make that one up.

Accepting the Inevitable

Anyhoo.....not sure if that little incident brought me to where I am to day or not - but it does conjure up a few smiles - which I could use right now.  So, as I stated I am ready to talk.....we need to talk.  I will have to now address the Big Elephant that has been in the room for awhile.  I have hinted at it, I have pointed at it, I have even explained how it hurts me - but I have not been completely honest.  Times are tough, it is bad - and there does not seem to be an end in sight.

• Sales for 2008 were sluggish, it started in the beginning of the year.  We watched our sales month after month decline - but we thought that they would pick up over the Holiday Season. 
• We were smart, we did pay attention to sales - we did everything in our power to save money.   We got shipping breaks, we purchased in bulk, we cut back, we improvised - we did make those few dollars we got stretch.
• The end of September when the Stock Market-Financial Crisis-Credit-Mortgage-Crash Thing happened our sales stopped.  For the first time in the  history of my company we had no sales for days.  We have over 200 sales channels - and we had not one sale.  People were not shopping, and they were not using their credit cards on line.
• Christmas looked good - nothing like the past years, but we rallied, we did well.  We shipped, we did favors, we took orders right up until Christmas.  We worked hard and created a lot .(not a ton, just a lot) of product that we happily shipped to the customer.  The future  may not have looked bright, but it was looking up. *

*As a drop-shipper and as a little guy (or gal) that works with all sizes of business - we ship our product and then we bill be the sales channel.  No, no the ideal way to run a company, but it had worked in the past - and some of these stores had policies in place before I came along.

The Aftermath

Not long after Christmas we had some bad news.......um some really, really bad news. 

• First we found out one of our largest channels filed for bankruptcy.  We still do not know if we will ever get paid by them - the Bankruptcy courts protect them - ouch! 
• Next another new large account could would not pay their bills until they spoke with their investors (they had already re-structured years before)....this one hurt more.  We never thought one of the Big Guys would not pay us - never occurred to us - never say never, believe me, I KNOW! 
• Other accounts were behind, some not paying on time, some lost invoices, check is in the mail.....starting to sweat a little now.  
• Many sales channels seemed to have had their credit cards maxed out.......day, after day, after day we tried to run charges.  Now I am blowing into a paper bag so I do not pass out.
• One sales channel had a health emergency and we have yet to be paid by them.

 Those that actually answered or calls or emails had an excuse, some just ignored our calls all together.  Or my personal favorite......lied about it, and when the check was sent.  The fact is that each one alone did not amount to a lot of money (well no not true a few did amount to a lot of money).  Mesh them together, add the almost extinct sales for the Holiday Season + Slow January Sales = putting my company in a very, very bad place.

When I started Jamie's Painting & Design I was green, I was new - I was literally so happy to get an account I did not pay close attention to the terms.  It was not too important when I was running the business out of home.  Margins?  We are fine?  Terms?  Whatever?  Sales, sales - if I sell it they will pay.  What I did not know would not hurt me, or so I thought.  As soon as I left the safe haven of a "no rent studio" I soon came to understand how important it was for our channels to pay and pay on time. 

Which brings me to where we are today.  We are not good.  Things are looking bad.  Bankruptcy court protects companies that declare bankruptcy - what if they take me down with them?  Do I get a bail out too?  So Congress, Mr. President where is MY bail out?  Companies that have no money.....no wait companies that spent the money I was owed, they got paid - me....not so much.  A maxed out credit card may never free up any funds. 

Fun  A Fact: A  small business that drop-ships and works with large/small/medium companies........can get screwed.

The Future Looks Grim

I do not want to really burst anyone's bubble, and sadly I heard that a few business in our industry have already closed up and declared bankruptcy - this makes me sad.  I do not want to become one of those businesses.  I can and will fight to survive - problem is we were already a lean-mean-well run machine.  People say I am resourceful, creative - they say I will figure it out.  Maybe I will.  I do know one thing though - if our channels do not pay us we can not survive.

Most Stressful Time of the Year

December 18, 2008 ---ah, oops I mean December 27, 2008...........Nope December 28, 2008. 

That's it, I am done, I am finished.  It's Over Johnny!  Pack it up, move it out.....we are out of here!  I have officially been replaced as Matriarch of the house by the Wii.....yes it is true.  My family live, breath and drink the Wii.  Even my two dogs, who got dog beds have given up on me.....they are sleeping contently in the room with the Wii as the rest of my family entertains themselves for hours on end with that damn toy.  Curse you Wii!

Yet, on a side note I was able to clean out the house, donate toys and clothes and finish a blog post.  May not be everyone's best day - but for me, heaven!  I also slept in to some unforsaken hour today that I will not ever repeat, so shoot me if I seem overly optimistic!

Okay, no I am not quitting, or closing up shop but I am done (we are done for the year) with shipping out our products for Christmas - got everything done yesterday, last Wednesday.  We rallied at the end, who knew one could work 12 hours a day for 6 straight days and not go crazy? 

The Efficiency Queen Fails

I think I have made it very clear how we strive to be efficient here at JPD.  It is what helps us stay lean and mean - and make all of our promises to our customers and sales channels.  Running a small business that is not efficient is like running in circles, with scissors.  I as the business owner need to wear many hats, some years I wear more than others.  I know it is just a must, but I was not so great at a few things:

Made 5 errors on 5 different Birth Certificates 

I was (in my defense) multi-tasking and my kids were acting very um....kid-like.  I was for sure not focusing and I screwed up.  The good news is they were caught before going out the door so we fixed them quickly.  It became a joke in the work room as the ribbons were put on the tiles, I would hear, "Um Jam, I found another mistake!"  Oh how I would cringe as they piled up!

Shipping Labels are not my thing 

I never get them right, well no most times or sometimes I do get them correct, but I make many mistakes.  I mean okay I get them right, but I forgot how labor intensive it was to make them, and even though we shipped everything out I did not get the correct tracking number to a few channels.  I am an anal super organized person, with a great memory for products............however I do make mistakes.  

My office is a mess  

It is messy, it needs to be cleaned....and I do not have the energy to do it.  Oh well - such happens when you ship out 2 weeks of work in 2 days.  I figure I will clean when I am dead (just like Martha Stewart, I will sleep when I am dead).  I am talking the whole office is covered in crumbs, and I have not been there since um.....oh gosh I don't know when.  Tuesday?  I need to do a deep cleaning, organize and possibly get some decorating advice from the divine Ms. Kennedy - if you have not seen her work area do drop by.  Just try not get to green with envy before you take a peek - gosh knows I did!

The Good Side of the Coin

We kept open longer this year - what I mean is we took orders from our customers and channels up until December 15th.   Now, to get across the country (we are based in California) we had to ship everything out by the latest on December 17th............drum roll please....we did it!  My employees, my husband, we got it all out. 

The crazy part is after working all Monday night to get products done by Tuesday, we kept taking orders yesterday - that would be Wednesday.  We got orders yesterday morning, made the tiles, ribboned them, got a label and shipped them out to arrive by Christmas.  It was a crazy day with laughing and sighing  (I mean singing, we had the Christmas carols blasting through out the office, much to the chagrin of my Dad and our Shipping Clerk - who uttered last Thursday morning, "Oh Thank GOD only one week left of Christmas Carols!") but we did it.  So thrilled to have gone above and beyond what I had promised my sales partners.  I am already thinking about shortening my turn around times once again.....after seeing what we did at Christmas time.  Take that hand-painting!

Money in the Bank

It is no secret that the Economy is struggling.  Our sales are off to say the least - I wish I could spin it more positively and say something about re-adjusting our expectations....but somehow the word sucks sounds better.  When we look at our numbers - Christmas ended up good - we did good.  When I compare them to last years numbers, a horse of a different color if you need a description.

Yet, I want to stay positive, realize that we could be worse.  We could have gotten no orders this season.  I am very thankful we continued to get orders.  As I stated much earlier this year, I feel that as long as you continue to sell items to your customers, they won't forget you.  Whatever we are doing we need to stay in front of our customers and make sure they remember us.  Because, even I know this will turn around, the Economy will improve....not sure when, but it will fix it self some day!

Ask & You Shall Receive

I have learned to ask questions of my sales channels, this has been hard but I do it.  I ask if they want exclusive designs, promotional sales partnerships, if they like my products, how they are selling, what I can do to improve.  

The one question I asked that has been pivotal in one new product is - what am I missing in my line.  Don't be afraid of asking this, you may be able to improve your products, add something new to the mix OR not.  Also, you may not like the answer - so be prepared for what they tell you - do you know, if you don't ask you won't ever know.

Looking to the Future

As crazy as it sounds I am actually excited about two new products for 2009 (and no they are not coffee cups for tots, though some mornings my six year old could use a cup of java).  I can not believe I am expanding - but I am.  I feel the need to bring one more product into the mix, and I also feel the need to do it fast.  

I am super excited by it also - really, I could not be more excited.  It is a bit scary to think of a new product, or a new concept - but it is what keeps me sane.  I can not sit here any longer and scream the sky is falling....cause it is, I get that.  Nothing keeps me more positive than developing something new, painting new designs - working to develop a great product.   

Who knows what the future will have in store for me, or Jamie's Painting & Design - I can not guess.  I can only forge ahead, keep my head up, wait and see.  I hope you all had a wonderful Holiday Season with your businesses and especially your families.  I wish I had posted this a few weeks ago, however life got in the way of my blog.  Just like it always does!

Maybe in 2009 I can get this blog back to the front burner of life and post daily.......um well if sales stay slow might be possible.  Well - I can wish anyways - to POST daily, NOT the Economy thing!  

How Wholesale Businesses Get Paid

October 1, 2008.

I have been following the financial "crisis" rather closely the last few, oh I don't know um 18 months!  How could I not be following it?  What small business owner is not checking her list once or twice, finding out which company has been naughty (not paying bills on time) or nice (uses a credit card)?  We have all heard the sob stories of how times are tough, blah blah blah - I hear ya, I am there and times are hard.  Sales are down, times are hard - now not live in a box, wear a potato sack, make rock soup hard - but being a small business owner right now - not so fun.

I wrote another post about this very topic over at Silicon Valley Mom Blogs.  I think here though I may take a different approach, a not so much Chicken Little but more a what I call,

"If you do not pay me I won't ship your product, and if I don't get paid I don't get to EAT!" 

The Beginning

Just so we are all on the same page I thought I would tell you how my business works, not how everyone does it just how I do it.  My way is neither right nor wrong - but it has worked for a number of years.  I have my products sold through channels, these are sales channels that have already existed before lil' old me came along.  I have lots and lots of channels, sales channels that all do their billing, their payment schedule, their advertising, um their list of who gets paid first differently.  Sometimes I am on top, and sometimes I am not.  Humor me as I go through the details:

The Wholesale Process

1. So - let's just say a popular children's online store sells one of my birth certificates: $35.00 (that is the retail price).
2. Then they charge the customer a $10.95 for shipping.
3. A $2.95 handling fee.
4. Let's add in a $5.00 gift wrap.
5. Next the on line store takes the customer's credit card and charges the customer a total of....wait for it.....hold on I must add on the fly, carry the 1, add the 5 okay got it: $53.90.
6. Confirm order has been taken, send nice thank you email to customer that order will be shipped in less than two weeks.
7. Automatically (or manually) generate an email that goes to my company placing the order.
8. My company sends an email back, confirms the order.
9. We put the order through our process.
10. We have the art made, it is put on the tile. It is personalized, can not be re-used or returned.
11. We put the ribbon on the tile.
12. We kit the order.
13. We make a shipping label for the order and we send an email to sales channel with tracking number and ship date (yes we are efficient like that).
14. We gift wrap the order.
15. We ship the order on time, just like we promised.
16. We bill the company for the order we made.

It has now been two weeks since we made this order.  We are out the money for purchasing the tile, the ribbon, the gift wrap, paying the employees to make the tile, ribbon the tile, shipping the tile.  We have done our part of the bargain - we have kept up our part of the bargain, am I repeating myself again?

The Payment for the Sale

1. We sell the tiles wholesale for $17.50 (the sales channel doubles the price).
2. We charge $10.95 shipping charge, this is a charge determined by Fed Ex, we don't profit.
3. We charge a $2.50 handling fee, it may be lumped into shipping but we have to make a box, wrap it in bubble wrap,use popcorn, seal it, label it.
4. We charge a $5.00 gift wrap fee - consists of wrapping paper, ribbon and a hand signed gift card.
5. We are owed $$33.45

Now you are probably thinking, what is the big deal Jamie?  Why do you want your money so bad?  It is not that much money to haggle over, just sit tight and wait for the money. 

"I Want My Two Dollars!"

Let's just say for argument sake that we have a 30 day net with this company and we trust they will hold up their part of the bargain.  You are correct- we are set up for this, we are fine waiting 30 day.....yep, 30 days, we will wait - and after 30 days?  Then what?  Let's just say 30 days comes and goes, we send out a reminder that they need to pay. 

But you see dear friend the sales channel took a credit card - the money cleared 48 hours after they took the order.   And I am not just waiting 30 days for that payment, I am waiting the two weeks it took to make the order(14 days) + 30 days before I get paid.....44 days IF they pay on time.  If they pay on time - all is great, all is good - what I signed up for a "win win".  However, if they do not:

By day 45 we have sent out numerous reminders, phone calls and still not a response.  At this point we threaten to hold all orders - which we do with a nice, but stern email stating why we are going to be holding any existing orders if this is not taken care of.  By day 60 we send out another email continuing saying now we will hold orders and we send the email to the owners, the customer service, the accounting department (again) and we are still out all of our money. Let's also say that this is not the only invoice we have outstanding with this company - let's say there are like 10?  Hmmmm.....shoot now I have to do math again, 10 x $33.45 = $334.50.

Fast forward to about 90 days and we still have not been paid. We refuse to accept orders.  Again, a little problem in our process, having to shout "NO DON"T SHIP THEIR ORDER!"  Or put post-it's on all the orders not to process - again, a tad irritating when we held up our part of the bargain.  We start to consider suspending our partnership and contacting the poor customers products we have.  Well, it can not get worse right? Right?

Bye Bye Sales Channel

One day while surfing the ol' internet we see the company is gone. The website is gone.  The phone number is disconnected.  There is no one to contact to pay us, there is no forwarding address.  Our last email came back as undeliverable. We can not find them on Google, we can not chase them down for our measly $300.  I feel bad they went under, I feel bad the company closed - I can not imagine how hard that is, but what about me?  What about me getting paid?  What the heck did they do with the money?  Pay someone else? Pocket it? 

Multiply this time 5, 10, 15 or even 20 channels?  What if more and more of my channels stopped paying their bills or went out of business?  Ten channels - heck that is rent payment right? That is a salary.  Heck just ten of those is huge....huge I tell you, and I am not kidding.  It has not gotten that bad yet, but it has happened, we have lost channels, we have lost money.

Blame it On the Economy

I got into business because I wanted to own this, I wanted to be in charge - I know that.  Nor have I ever been in business during a down turn, a recession a (gulp) Depression - all has been good.  This just one example of what has happened to me.

Now this is easy for me to blame to the economy, gas prices, raising food cost, whatever.  However, as a small business owner if I don't get paid I can't stay in business.  Then I don't spend money.  That affects other businesses that I would purchase from - my tile company, ribbon company, office supplies, phone company, shipping supplies - I can't pay those people.  Not to mention my people, I can't pay my people.

The Economy Affects Everyone

I have tried to explain this little fun scenario (not so fun right?) to those nay-sayers that tell me all is fine.  Yes, all is fine....for now.  But this little story I tell you about one channel - it is not made up.  It is true.  And companies paying late, or not paying is more common than I can tell you.  We do try to make companies pay for first order, pay up front, pay before shipping or pay with credit card.  Most of our channels are very good partners and we always try to work with them if we can - we understand.

And most (make that 99%) of the companies are not like this, I work with some of the bestest mostest wonderful channels, some I can call friends, even really, really good friends.  But even good friends can't pay you sometimes....*

*Please note that I will not divulge which company this was, nor will I say who pays and who does not.  I have hundreds of sales channels and only a little more than a handful are EVER a problem.  The solution is to communicate with the other company, so both understand how they can make payments or how we can help.  This post was just to make people understand that if the economy is in trouble it trickles down to us small business owners....all of us.  And yes if you must know this is a true story, and NO this was not a friend....and yes I am still mad.