Committing Your Clients to Their Perfume Orders
When you’re in the business of distributing and supplying customers with a manufacturer’s products (Papillon’s divine perfumes and effective natural skincare solutions in this instance), there are a few financial risk factors that you should take into account before you place your orders with the manufacturer.
Even if they don’t exactly chop and change at the drop of a hat, people may be a tad fickle, prone to changing their minds or spending the money that they set aside to pay for perfume on something else, while they’re waiting for the arrival of the goods that they ordered via you, their Papillon supplier or distributor. Although our lead time at Papillon is short, there’s still a small time lapse between the receipt of orders and dispatch.
Obtain Equal Commitment
From your perspective, you’re financially committed to paying for every perfume or other order that you place with Papillon. This means that you should take every possible measure to ensure that your customers are likewise and equally committed to paying for the goods that they’ve ordered, and promptly at that.
Do Yourself a Favour with Deposits
Do yourself a favour, just as most other successful businesses do. At the most appropriate time, briefly explain the procurement process and minimal lead time to your customer. Inform him or her that a percentage of the full price is required as a deposit to enable you to place their order with our order department.
Although the exact percentage you insist upon is entirely up to your discretion, keep in mind that “deposits” of 40-60% are frequently applied to secure orders in the general market place. This practice is commonplace; most customers have come to accept that many, if not most suppliers require a deposit before any order is processed.
It’s financially sensible to be committed to a purchase once you’ve paid the supplier a portion of the price of your goods. No one in their right mind simply gives hard earned money away for nothing in return, which is why this is advantageous and helpful to suppliers and sales persons.
Minimising Risk Factors
You are simply ensuring that you don’t carry all the risk in case a customer defaults. It’s a mutually beneficial way of avoiding pitfalls and it’s a quid-pro-quo, win-win situation – nobody loses, and everyone gains once the process is concluded.
By the same token, you are not completely out of pocket should the customer fail to honour their part of the transaction in full, although this is very rare in our experience. Our remarkably keen, affordable perfume prices, combined with the exceptional quality of our fragrances, help to eliminate any tendency to default on the part of buyers.
Healthy Cash Flow
Cash flow and the control thereof may be tricky if not carefully managed in any business, especially one that is small or starting up without the backing of considerable capital reserves. Nevertheless, establishing a healthy, well-managed cash flow may easily be instituted by adhering to a system that requires a deposit upon order – one that enables you to meet your financial commitment to the manufacturer and source of your products.