Today we’re talking to Ryan Ortega of Emergency Medical Transport about how important it is for businesses to ditch paper systems. Ryan explains how his business blossomed after implementing the right software.

Now this is an area I never thought I would dip into when we started our own business – HIRING a collection agency.  From the title, some of you probably thought I would be discussing how to avoid collection agencies as a small business – but alas.  As a small business owner, one of the first rude awakenings you come to in your business life is – lots of companies don’t pay on time.

It never occurred to me, in the course of my life as an employee that b2b collections would be such a common difficulty.  And the worse culprits are – large corporations!  I am starting to believe it is by design, but my experience reminds me that it is case to case and you can’t accuse all companies of bad business practices.

The interesting part is dealing with the actual collection agencies as a customer.  It is a completely different experience than being on the end as a recipient of their service! 

I have come to find out that collection agency sales reps & service providers are some of the best sources of hands-on business advice.  It comes from their experience.  I know that I don’t want to be a jerk to our customers.  I also have come to know when I am being played, jerked around, or plain disrespected for the services we provide.  In the later cases, it helps to call on a professional to handle the situation – saves time, frustration & plenty of self-doubt about what you are doing.

Some of the interesting things I have learned in discussing cases with collection agency representatives:

1. If a client immediately tells you that they will report you concerning the “Fair Debt Collections Practice Act” then they are very familiar with being called on by collection agencies & they know how to play the game.  BTW this Act does NOT apply to commercial debt, only consumer debt.
2. Never give a threat or tell a customer what you will do next.  If they are refusing to pay, leave the conversation open ended.  The biggest fear for anyone is the fear of the unknown – leave them wondering if you are going to get a collection agency after them, stop servicing them & ruin their business or come after them with the proverbially baseball bat (I am not into violence, but it is always a good visual when I am in a bad mood).
3. There are two kinds of customers: those with intent-to-pay and those with no-intent-to-pay, the former can be helped, ie factoring (getting a loan against their receivables), the later are just jerks & you will most likely need to come down like a hammer at some point.
4. This is case specific, but don’t continue doing business with an unhappy customer.  This is just a time & energy soak for you as a small business.  If they aren’t happy with your product or services the first time you interact, then you try to rectify the transaction & if they still aren’t happy – they will most likely never be happy & you will continue to argue about quality of your business, amount to be charged/paid and ultimately you will end up in court – THE WORST time soak for any small business!

If you are facing the collection agency road, I wish you all the best and just know – b2b collections are far more common then most small business owners are aware.  One agency representative told me there are 26,000 b2b collection agencies in the US!

What some small & mid size business owners don’t understand right away is the value of the one asset that is unique to their business – their data.  Your data is your gold.  It has been mined by you for your profit & needs to be treated like gold.

It doesn’t matter if you are a restaurant owner, a consulting company or clothing manufacturer - you mostly likely have a host of competitors.  The single distinguishing factor besides your business process, which may or may not be remarkably unique, is your data. 

A small business’s data can be anything they are tracking in Excel, Outlook, Quickbooks, Word, Act, on paper or any other program.  Major types of date for small businesses are:

Customer Contacts – this is, of course, the most important & why CRM, Customer Relationship Management, has sprung an entire software industry for this specific need.  Each of us needs to know our customers, keep track of the contact information & be in constant contact with these people, in order to thrive and mine more gold (referrals).
Billing & Collections Information – this is a by product of Customer Contact information in which we need to know: who is paying and who isn’t.  It is hard enough to win business in competitive industries, once you have the business it can be equally challenging to collect the check.  This information is critical to keeping cash flow going and not something you want to spend valuable time doing every day.
Suppliers – who provides you with the products & services you need to do your business could be priceless if you have the most efficient & cost effective suppliers.  This is information you need to keep up-to-date & readily available to utilize the best production of your product or service, there by saving your gold for better uses.
Inventory/Sales – In order to make the best decisions for future purchases, amount of stock on hand, when to hire the next employee, or a variety of other necessary business decisions, you need to keep accurate track of the sales of your product or service.  You need to be able to reference this data in an easy to understand format & have it readily available for making short & long term growth decisions.

How do you want to handle this important asset?  Do you want it to be on paper in bins on your desk?  Do you want it in on your laptop in different software programs & files to sift through?  Or ideally – would you like it in one system that can be cross-sorted & reported on for the highest level of accuracy. 

This is something to think about as a small business.  Building your excel spreadsheet to track sales, inventory, etc. works fine when you are planning & getting started.  The issues arise as your successful business growths and your data increases dramatically.  Planning for this ahead, avoids mistakes and fosters better decisions in your business’s growth.  And this maximizes the power of your gold. 

Cooperation & Collaboration   

The time has come.  The key to success, especially in California, to turn this economy around and thrive like we would like as a species is Cooperation & Collaboration.  I don’t mean to say that healthy competition & first-to-market aren’t important.  But the reality is that anything done worthwhile has been a team effort.  Healthy human beings thrive on the energy built on interaction of excited people creating together.  And constructive discussions and arguments are a necessary part of that.

There seems to be lots of work - on the budget, on the environment, on health care reform - done in silos or in dead competition.  This is an old paradigm.  Change is eminent, and as a former president has often been quoted – “You’re either with us or against us” – just doesn’t work anymore.  The essence of this change is a combination of self preservation as a human species and the race for the all mighty profit margin, especially in the current economy.  These two issues facing our species have often been viewed as diametrically opposing factors; but today they are being considered a necessary combination - ie “cap & trade”.  This can’t be a bad thing and certainly leads back to a necessity for Cooperation & Collaboration.

This is evident at both the government and private sector levels. 

How can city, county & state organizations work more cohesively toward specific goals?  Why does the support for a city program end at the city limits when it naturally affects the surrounding cities or towns, especially in metropolitan areas like Los Angeles or San Francisco?  City & state governance bodies need to better organize to work in harmony – it is the way of the future.

Why are innovative companies working on cutting edge projects in silos?  How can the competitive edge be retained while at the same time the sharing of ideas, mis-steps and profit-losing mishaps be distributed?  Corporations could learn from each other – saving time and money for everyone in the long run: employees, stock-holders, consumers.  It is possible - it is just a shift in practice. 

Change is necessary and it is inevitable.  There is power in numbers; people working together for the improvement of the issues most pressing to our species.  Healthy argument and difference of opinion is encouraged, but the bottom line is we need better coordination to meet the needs of the whole, both economically and environmentally.

Sandy Kotch

CEO

Truion

Business Software Experts

310-729-3000

www.twitter.com/kotchya

www.truion.com

www.ionobjects.com

“How can I help you?”

Attending the LA’s Largest Mixer on Thursday night as our consulting company, Truion, & our innovative software product, Ion Objects; I have to admit I was a bit jaded.  We have been in business for 9 years and have accomplished amazing technical feats with Ion Objects for so many local LA companies as well as large corporations.  But our combination of challenge to the business software status quo and lack of marketing expertise, send us into continually being dared to prove our capabilities and establish our value to prospective clients.  We work hard for our loyal clients.  So I arrived at the Mixer wary of combative sales.

Yet, in networking with another exhibitor, Expert Level Consulting, whom we have had previous interaction at a client site, I was blown away with the genuineness of one simple question that the founder, Greg Sewell, posed to me while looking me directly in the eye. 

“How can I help you?”

This wasn’t the retail salesman asking me.  This wasn’t a vendor asking me.  This was a colleague; perhaps even a competitor in the world of consulting, who looked me directly in the eye and sincerely wanted to know how we could help each other.

This one communication sticks with me from Thursday evening.  And let me say, it isn’t just the question, but the authenticity behind it.  Oh yes, we spoke to many, many people in the 4-5 hours spent at the event.  Many were very enthusiastic about what we do. Some were selling us on what they do.  A few were disinterested. 

But one company asked, with minimal regard for their own gain, “How can I help you?”

This is my renewed mantra to all businesses either competitors or clients - small, mid-size or large corporations. 

We started our company with this attitude.  But over time, beaten down by corporate departments that scrap our unparalleled solution because of a mandate to off-shore all development or a mid-size business that nickels & dimes us for a perfect solution that they could never have afforded from other consulting firms in the first place, true enthusiasm for “How can I help you?” eroded.  Scarred by experience with large corporate mandates & greedy customers, “How can I help you?” becomes a hollow, tired question.

My enthusiasm is reignited.  The time is now for small & mid-size business to drive cooperation & collaboration to make this planet a better & more pleasant place to spend our time.  We can do this collectively.

Sincerely – How Can I Help You?

Sandy Kotch

CEO

Truion

Business Software Experts

310-729-3000

www.twitter.com/kotchya

www.truion.com

www.ionobjects.com