5. Understanding as to terms.—In both retail and wholesale credits, the amount of credit to be given and the date upon which payment is to be made are likewise subject to prearrangement. Once de termined, these matters should be regarded with due seriousness. If they are not so regarded, it is gen erally the merchant's fault, in that he failed to im press upon the customer in the beginning the fact that lie was expected to carry out to the letter his part of the agreement.
If the exact time of payment has been agreed upon in advance, it devolves upon the debtor, in case he becomes delinquent, to show cause why the amount is not paid according to agreement. Many merchants take the position of regarding the customer's payment of his debts as a favor, leaving with him the impres sion that such payment may be withheld if it is not entirely convenient to make it at the time it is due. This mistaken attitude is responsible for many bad debts and unpaid bills. A debt is always an obliga tion, and must be so regarded by both parties to the transaction. If an extension of time is desired it is the debtor's duty to obtain the creditor's permission for such extension. Payment cannot rightly be de ferred without the creditor's consent. The principle applies to retail credits just as fully as it does to credits in a wholesale house.
6. Opening an majority of custo mers who desire to open a charge account in a retail store are women, who are frequently averse to being subjected to what they regard as inquisitorial methods on the part of the person in charge of the store's credits. Their traditional lack of business training tends to make them consider questions relating to their financial condition or to their family income as a reflection upon their honesty, nor do they always un derstand why they should be asked to tell at what stores they are in the habit of making most of their purchases. Accordingly the credit man, in his in terview with the credit-seeker, must conduct the con versation as tactfully as possible, at the same time being direct and businesslike. If the credit-seeker seems unusually ignorant of business practice, the credit man should explain the why and wherefore of his questions as simply as possible but without "talk ing down" to his hearer. He should be able, in the course of a brief and pleasant conversation, to learn enough about the circumstances to determine in a general way whether or not the account is likely to prove desirable to the house. Some information as
to where the customer is trading at the present time, to serve as a basis for investigation of payment habits, should also be sought at this interview.
Many retail credit men go upon the assumption that a credit customer will always pay the first bill, and that it is subsequent purchases that need watch ing. Accordingly, unless the appearance and con versation of the customer plainly indicate the wis dom of the opposite course, they 0. K. the order and at once accept the person as a charge customer and seek to obtain by means of outside investigation such information as will guide them in their subsequent handling of the account.
This procedure probably works well in many in stances, but up-to-date credit men feel that they should not be required to play the part of a detective in order to obtain data for a credit-grant of this nature. They feel that perfect candor should invaria bly characterize the interview between credit man and credit-seeker. Since, under the conditions which govern modern merchandising, the margin of net profit except in a very few lines of business, is small, and since losses must be carefully guarded against, credit men think that they should be given all neces sary information at the time that application for credit is made.
Unquestionably, the latter viewpoint is—at least theoretically—correct; and it is highly probable that in a majority of instances the customer, whether man or woman, could be made to see the justice of this contention if the credit man would urge it sufficiently. It would, however, be poor business policy to risk losing a desirable customer merely for the sake of securing his acquiescence in a principle. Hence the rule that in most instances of this kind is found prac ticable, may be briefly expressed thus : Obtain all the information you can at the first interview, but carefully avoid offending the cus tomer ! It is at this point that a knowledge of human na ture serves the credit man well. Good common-sense, the ability to put two and two together, and a cheer ful, optimistic attitude of mind, will usually enable him to reach a satisfactory conclusion without incur ring the customer's displeasure.