Being a Good Paymaster Builds Better Relationship
Being a Good Paymaster Builds Better Relationship
How being a good paymaster builds a better relationship? Have you ever wonder, apart from your payslip and account statement, what are the criteria that banks or business associates look into upon approving your application? Have you ever heard of friends and family members that their credit application is rejected despite having a big salary? That’s probably the case of not being a good paymaster.
A good paymaster can be simply defined as anybody that pays their loans or credit on time and according to the agreed repayment schedule. Whether it’s a business debt or personal loan, your pattern of repayment is monitored. From there, they can identify your credibility and classify you as a good paymaster.
Businesses and Payment
Keeping up with your debts will lead to a better relationship.
As for business relationships, a good paymaster is an entity or a company with the ability to pay all the stakeholders on time. For example, in the relationship between a supplier and a manufacturer, where the manufacturer pays the supplier on time every month is deemed as an act of being the good paymaster.
Making sure you pay your loan and debt on time has many great benefits, and most importantly builds trust in business relationships. Trust is like glass, once broken it will never be the same again.
According to Brian Sooy from Big River, trust is critical in a business environment and the element of trust is something we cannot buy, but need to be earned. Whether it’s the relationship of you and your financing bank, your direct supplier or client, trust is crucial and shall not be broken.
Strong trust in business is essential for a company to grow and sustain as well as to develop a reputation in the market.
Many important elements contribute to the strength of trust in business. Such as effective communication, integrity, transparency and reliability. Practising these values not only makes a company stronger but drives the company with a better direction towards achieving their goals.
With excellent integrity, showing great reliability and transparency, a company is a committed good paymaster. Hence, being a good paymaster builds a better relationship with clients, employees, stakeholders, including manufacturers, suppliers, and partners.
Payment towards all the suppliers needs to be made on time and according to the agreed arrangement. Whether it’s a daily or monthly basis. Being up to date on payment build trust and good relationship between businesses. In return, suppliers would provide better services and deliver the best quality of items and goods on time.
Identify a Good Paymaster and a Bad One?
Dealing with a good paymaster is undoubtedly swift and cuts of all the hassles and hiccups. But how do we identify one?
Similar to how the bank identifies good paymaster among individuals, records would help businesses to recognize who is a good paymaster.
A good paymaster would have better financial stability and holds a good record with past clients and
stakeholders. While a bad one would usually be in financial difficulties and comes with bad records of
paying their past debts.
Plus, a company with a good record of paying their debts are usually committed to doing so and would not let their stakeholders chase them for payments. On the other hand, a company that is not reliable would always give excuses when it comes to payment.
It is important to check the credibility of a company before going into a business deal with them. This is to avoid any unfortunate events of not getting your payment on time, or even worse, not getting the payment at all.
How to avoid bad debts?
First and foremost, laying out the Terms and Conditions clearly at the beginning would the best to avoid any bad debts and misunderstanding. The document shall make your customers aware of the payment terms.
Another option to avoid bad debts is to impose interest on late payments. This way, customers would commit to paying the debt on time to avoid any further interest. Such action is appropriate to impose to existing customers with bad paying records, to get them to pay their debts and avoid repetition.
It is also important to get the right advice on how to collect debts and avoid bad debts legally. Engage with a professional advisor or lawyer would be the best step. Legal advice on the correct ways to deal with bad debtors and the most effective actions to take would make the whole process swift.
Dealing with customers that refuse or make excuses to avoid paying their bills is not the best experience. However, we need to be committed to pay debts and loans on time. Apart from that, making payments on time will ensure our financial planning is smooth. Cash flow is the key to keep a business afloat.
Being a good paymaster builds a better relationship and grant you a good reputation too.