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Credit Card Scrutiny and Selling in a Recession

By December 26, 2008 No Comments

Last week I heard an NPR “Talk of the Nation” piece entitled “How to Handle Your Debt in a Recession”. Among other topics, Neil Conan’s guest, John Ulzheimer, president of Educational Services and author of You’re Nothing But a Number, highlighted the additional scrutiny credit card providers are putting their customers through. In particular, one call-in guest, a merchant, said that a business credit card, which she had been using for five years, dropped her as a customer based on information she had provided to them in a phone discussion when she was trying to negotiate a better rate. She said they had asked her about her debt to equity ratio, her cash flow and other information which in hindsight she would have been better off keeping to herself.

That certainly is a cautionary tale for all of us, but it may be a lesson as well.

I think that we sales people and consultants had better start scrutinizing our prospects and customers at the beginning of what should be a challenging year for all of us.

Not all clients have equal value; not even close in some cases. Consider the following,-

1. Does this company “demand”, even “expect”, that you as a solopreneur will give them substantial discounts. You might, but consider whether the transaction is valuable to you in other ways than profitability. Like as a reference for example. ROI is important for all companies, independent of their size .

2. Does the client pay you on time? The time value of money does matter, particularly to small entrepreneurs. Cash flow is everything.

3. Is this client demanding changes to your product or services which is particular to them only or can you re-purpose it to use with other clients? If not the latter, you ought to think long and heard about whether this client makes sense for you.

4. Are you solving a real pain point for them in a differentiated way at a price point for which they have budget now? If the answer isn’t yes to all of these points you may be wasting the most valuable commodity you have – your time.

5. Finally, are you using social media tools to gain unfair advantage against your competition?

We can all be sure of a few things in 2009, there will be less money being spent, that sales cycles will lengthen and that many sales will end in no decision – the competition will turn out to be “do nothing”. Whether its LinkedIn, Facebook, Twitter, a blog – doing the same things as last year will only guarantee one thing – sales will be worse than in 2008.

Go close some business,



Twitter: edcallahan