To those of you who read the title and assumed that I was going to go political, I’m not. Although that would be easy to do these days no matter the side of the aisle on which you reside. Instead, I’m going to keep it strictly business and refer to the abuse of power I’ve seen far too often when huge enterprises ramrod (I know I’m using a noun as a verb) terms and conditions down the throats (and mixing metaphors) of small suppliers and employees.
In the latest example, several of my clients have gotten letters from a major company unilaterally extending payment terms to 120 days and refusing legitimate price increases. To add insult to injury, the company doesn’t even bother to pay within their own stated terms despite the fact that they are excessive. To make matters still worse, they further offered to “help” by providing a link to a major bank who would finance the extended AR (at prevailing interest rates, of course). Neither of my clients need financing assistance. They both have strong balance sheets. What they (and countless others like them) need is a customer who is willing to do the right thing and pay within reasonable terms. They also need a customer who will put someone with authority on the phone to discuss both payment terms and cost increases as opposed to referring vendors to an email box that either doesn’t get answered or provides such a generic response one cannot tell if there is a human behind the email or just a bot. Of course, their corporate web site has an entirely different spin and talks about sustainability and how they’re a great “partner”.
Many years ago, just after 9/11, a major law firm I knew of used that terrible moment in time to slash the administrative workforce and limit salary increases. That resulted in some good people becoming unemployed at a very difficult period, leaving behind demoralized and overworked staff for those that remained but record breaking partner profits. Was that the right thing to do?
If you’ve been in the working world for any length of time, I’m sure you can think of numerous examples. So, what’s the solution? Well, I don’t think it’s more laws and regulations. We have too many already. Instead, I think it starts with character and courage.
If you work for a major company that behaves in this manner, then do your part by voicing your opinion. If you’re in a position of power, refuse to participate in egregious practices. Have an open and honest dialogue with the “other side” so that you understand the impact of actions like the ones referenced above.
If you find your company being trampled on by a major player in your industry, have the courage to push back. It can be difficult and a bit intimidating but I’ve done it successfully over the years.
And know that most small business, which are the lifeblood of our economy, don’t behave this way. My clients earn nice profits, but they all strive to be fair to their employees and other companies with whom they work. Otherwise, they wouldn’t be my clients.
If your business could benefit from fractional CFO services, I would welcome the chance to speak with you. Please give me a call at (314) 863-6637 or send an email to [email protected]