Tuesday, November 25, 2008

Know your customer

Last month I wrote about the need to be sure that a shipper does not pay a broker, and get left holding the bag for freight payment.

On the flip side of the coin is the need for freight brokers to be sure their customers are paying their bills in a timely manner. The American Shipper has an article outlining this problem.

In a follow-up interview with American Shipper, Clark described how Cargo-Master made a deal with the chief financial officer of a customer that owed about $400,000 in back payments. Under the new terms, the customer agreed to pay $25,000 per week of the outstanding debt and pay on time for booked freight going forward. After a couple of weeks the payments dropped to $12,000 per week and Cargo-Master decided to cut off the customer.

It's always hard to turn down a customer. Especially if you are in sales. But, it's a necessary evil, especially in today's environment.

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