"You might as well have no business than bad business." I was told. Not sure exactly what he meant I asked, "No business?"

"Right, let me explain. Bad business happens when you invest a lot in developing a prospect or customer and they don't pay you. So after giving them the best service, training, and support they do not pay you or pay you a lot later than the terms agreed to when the account was set up. You would be better off with no business" he went on to explain. "Every time we get a new customer there are many costs incurred in addition to the time you spent selling to them. The accounting department has to spend time setting up the account, we have to pay shipping on the products they buy from us, the order desk spends time servicing the customer and then we have to spend additional time getting paid."

He went on, "Whereas if we had not done business with them we would not have incurred all those costs or we could have been servicing an account who actually pays there bills instead of wasting our time with an account that does not pay - that is bad business."

I was a young salesman working for a large warehouse distributor and my mentor was the 80 year-old founder, a very successful businessman who accompanied me on a series of 'bill collection' sales calls. I will never forget that experience. Here was a crusty old codger with a patch over his eye (recent eye surgery) and a cane teaching me, his young apprentice the most elementary of lessons - show me the money.

Increase Sales and Marketing Team Effectiveness

It is common practice to purchase a list of prospects from a list broker to supply your sales team with specific sales leads. By using D&B to screen each lead as too credit worthiness you can eliminate those prospects with a history of late payments.

One of the common tactics of small companies in financial trouble is to find alternate suppliers and alternate from month to month who gets most of their business. See, they are robbing Peter to pay Paul. For example, your sales person suddenly comes in all excited with a large order, all seems well. Except, they have a secret.

The secret is that they will milk you for everything they can get over the next 30-60 days until you cut them off for non-payment. Then they switch to another supplier and you do not get paid for another 60 days meaning you wait 120 days to get paid. Bad business.

D&B Can Help Pre-Qualify Sales and Marketing Leads

One of the many great small business tools is the D&B CDecision. It is available in two versions with or without a quarterly update. Both provide:

"...information on over 2 ¼ million D&B company records both active and inactive. Key business information includes business name, address, telephone number, D-U-N-S number, SIC code, line of business and more including D&B Payment Index. CDecision can help you make low-cost credit decisions quickly, easily and affordably."

In my opinion D&B is the undisputed leader in commercial, business-to-business credit reports. Check out their CDecision products and other D&B Credit Publications for yourself, here.