How can you tell if a customer might be a credit risk? There are signs you can look for.
- If they shy away from filling out any paperwork, be cautious. If someone has good credit and nothing to hide they have no problem filling out paperwork.
- If they can’t give you a land line phone number or other contact information, this should be a red flag.
- If they won’t give you any references, saying things such as I am new to the area, or I don’t have any references, I am trying to establish credit, be careful.
You can still do business with a customer like this but start out as COD or pre-payment required. Once they fill out a credit application and you check their credit, if they have minimal credit, work with them and offer something such as 50% down and 50% due at delivery.