The Job’s Not Done Until You Collect Payment

What do you do when your customer won’t pay for their job? That’s a question being asked more often by printers. As the deep recession continues throughout the year, printers are finding that a greater majority of their customers are paying for their jobs slower, or some simply not at all.

If a shop does not have a credit manager in place, it is up to the controller or vice president of finance or the owner to reign in these customers and collect money that is past due. Outstanding debts can become costly, especially if the printer has to hire an attorney to take the customer to court.

“Printers need to become more sophisticated,” said Dolphe Marcus, vice president of collections for Printing Industries of Southern California, the largest affiliate in the country with more than 1,800 members. “The job is not completed when it is shipped; you have to get paid!”

One of the best lines of defense is to have a credit manager overseeing operations. When Carolyn Davis oversaw the credit department for ColorGraphics, once the largest privately-held printer on the West Coast with plants in Los Angeles, San Francisco, Seattle and Costa Mesa, she managed eight employees for the high-quality commercial firm. “My job was to ensure that customers were worthy of credit and how much to extend,” she said, who has since left the company. “We were overseeing credit for nearly 600 customers of jobs between $5,000 to millions of dollars.”

As credit manager, Davis collected detailed information on the principals of a customer’s business as well as a bank reference, and required five trade references, including one which had to be another printer, preferably in the dollar range of the customer’s upcoming order(s). She also sought out credit reports from both Dun & Bradstreet and Experian and utilized the Printing Industries of America Slow Pay service (more on that later).

Use Common Sense

“We found that getting both the D & B and Experian reports provided us with different information about the customer,” said Davis. “We evaluated all of the information thoroughly. As a service to our sales force, we would run the credit report on potential clients and if there were any red flags, we’d let them know. Common sense and communication were our main department methods. After more than a decade as credit manager, our bad debt was very low.”

However, said PISC’s Marcus, nine out of 10 small print shops (less than 25 employees) cannot afford to have a true credit/collection manager in place. Where does a printer turn then?

In many cases, a printer’s local association, such as a Printing Industries of America, has helpful guidance to teach printers how to gain relevant customer information in case they need to go to court and how to determine early on which customers receive credit and how much. Some offer seminars during the year where an attorney will be on the panel that specializes in the printing industry.

Printing Industry Credit Bureau, a licensed, bonded, and insured company that provides national coverage, quality service, and a dedicated staff, works closely with a number of affiliates nationally including Printing Industries of America and provides discounted rates for collection services to members and participating affiliates.

PICB is a privately-owned firm headed by Andrea Schlack, president, which was previously part of Printing Industry IL/IN Association. Schlack is a member of the Commercial Law League of America. PICB offers state-by-state information, placing a claim for collection, slow pay, sample forms, sample letters, account receivable tips, and credit scam investigation. PICB will work with any company that needs assistance but offers substantial discounts to members of the participating affiliates.