Alright, so I run a small hardware store and I was drowning in debt last year. Instead of hiding from my suppliers, I just laid it all out, told them I couldn't pay on time and needed to restructure. Two of them worked with me, one dropped me. But the two that stayed? They actually sent me leads and helped me avoid a death spiral. Anyone else tried this? I feel like most people just ghost their vendors and it blows up.
Suppliers
Why being totally upfront with your suppliers saved my store
Bold move. I tried that with a lumber supplier and he just laughed and put me on COD. Guess it Depends on the relationship.
Being upfront is fine until they put you on a watchlist and every new supplier hears about it. My old boss did the same thing and it worked for him, but he was already a big account. For small guys it's a coin flip.
What exactly did you say? Like, did you show them your books or just give them a sob story? I'm curious because I've got a footwear client who's about to misss a payment and I'm wondering if I should coach them to do this.
QuietTundra, I brought a one-page cash flow printout. No full bookks, just the next 90 days and what I could realistically pay. The two that stayed appreciated the honesty—one actually said most people just stop answering calls.
Honesty is great but I've been burned. Told a supplier I was struggling and he immediately demanded the full balance. Turned out he was in trouble himself. So now I'm more careful. Timing matters too—don't do this right when they're about to close their month.
One more thing: get it in writing. Verbal agreements are what got me into a mess last year. Suppliers 'forget' they agreed to a payment plan the second second they get a better offer.
This is the most boring 'saved my store' story I've ever read. Where's the part where you fight a bear or something?
Bear was the landlord.
Thanks for the detail. I'll pass that along. Honestly the cash flow printout idea is simple enough that even my client could do it.
Also, don't expect every supplier to be a saint. Some will use that info to tighten terms or spread rumors. I've seen a guy lose his best vendor because the owner got 'honest' at the wrong time.
RustyNail99 is right. I'd add: talk to your top 2-3 suppliers first, not the whole list. If one of them is gossipy, you don't want the whole network knowing your business.
Yeah, I didn't broadcast it. Only the three I owed the most. And the one who dropped me? He was a jerk anyway. No regrets.