October 26, 2023

In the world of business, a dead deal is a haunting reminder of opportunities lost and partnerships that crumbled before they could flourish. Credit professionals can work closely with the sales team to not only secure sales, but prevent and resurrect so-called dead deals.

Before a Sale Dies

Credit managers can help prevent dead deals and maximize company profits by responding promptly to sales inquiries regarding credit terms, customer creditworthiness and approval processes. This enables the sales team to make informed decisions and move swiftly in negotiations. They also can offer creative credit solutions that align with the customer's financial situation. This may involve proposing alternative payment terms or credit enhancements to make the deal more appealing.

To help the sales team understand the credit process and its implications, consider these tips:

• Provide ongoing training to bridge any knowledge gaps and promote a cooperative mindset between the two departments.
• Help sales understand the true cost of extended terms, and why it may not always be the best option.
• Maintain open communication with the sales team, exchanging feedback on both successful and lost deals.
• Learn from past experiences can help refine strategies for future sales opportunities.

When working with customers, it’s best to exhaust each strategy before it becomes a dead deal. “I never consider an account dead,” said Martin Smith, CCE, CICP, credit manager at Ash Grove Cement Company (Sumterville, FL). “The customer may choose not to accept the terms but I’m willing to evaluate them to see if there has been a significant change to give me comfort in extending an open line of credit. Everything changes with the business conditions and a properly functioning credit department anticipates these changes and acts accordingly. Know when to hold them, fold them, walk away or run.”

Bringing Deals Back from the Dead

For deals that appear to be lost, credit professionals can assess whether there's a possibility to renegotiate terms or explore different financial structures that might reignite interest. Resurrection comes in three forms for Kevin Chandler, CCE, director of financial services at Zachry Industrial, Inc. (San Antonio, TX). “One is that the client has decided they want to make changes to a transaction,” he said. “Second is that you decide to move off because your risk profile has changed. Maybe you have a client you're no longer doing business with that was risky and now this client fits within your overall risk appetite and you're fine or you decide to take on more risk, which is fine. Or third, both of you decide to resurrect a dead deal.”

Before resurrecting a dead deal, credit professionals must reevaluate their customer and measure their credit risk. “If the customer is not sharing enough financial information, you question the customer’s character, there’s pressure from the sales department on a deal or your gut tells you that something doesn’t seem right, try to write the customer’s story,” Kevin Stinner, CCE, CCRA, credit manager at JR Simplot, Inc. (Loveland, CO), said during a 2023 live Credit Congress session, Trying to Get to Yes—Making the Call When You’re on the Fence. “If a customer doesn’t want to share their financial statement, start by asking specific financial questions to collect that missing data and ask them why they’re in their position so they can get over their financial hurdle.”

Strategies to Close Deals

Creditors can play a pivotal role in collaborating with the sales team to help close deals and ensure a smooth transaction process. “You want to work with the sales department and get involved as quickly as possible,” Chandler said. “The sales team should be contacting you very early in the process to talk about when they consider doing business with a company and divulging any financial information to you. Then, you go from there in the credit investigation. Get the customer’s information and run credit reports. Now, you're arming your salespeople with sufficient information that can help them in the sales negotiation process. It’s a collaboration.”

Once you have sufficient financial information about your customer, you’re able to negotiate so that both parties are benefiting from the transaction. This can be in the form of customized terms or streamlining the approval process with discounts. “We want a standby letter of credit (LC) upfront all the way to open terms,” Chandler said. “Instead of granting customer payment terms of net 15 days, we give them net 60 days or more. If the customer won't budge, we use personal guarantees or corporate guarantees in credit applications as layers of security to help secure a transaction. We don't do discounts, but I've been in industries where discounts were done in the past to close a deal.”

Strategies for closing deals or resurrecting dead ones depend on the industry, said Timothy Bastian, ICCE, senior director of corporate risk at Western Oilfields Supply Company dba Rain for Rent (Bakersfield, CA). “The challenge often seen in deals has more to do with the complexity of the projects and risk associated with projects,” Bastian said. “Credit is often involved on the front end because if something goes wrong, they must understand how to get paid. We do have hard redline items that we will not cross when discussing the balance of risk. We have a collaborative strategy, and the bigger issues get a full court press with internal and external experts weighing in on the best approach.”

Combining business with opportunities for fun, relaxation or adventure is a popular trend on the rise in the travel business world—also known as "bleisure," or the mix of business and leisure. Work life and personal life usually have a clear separation, but the traditional views of business travel are starting to change. Attending business meetings by day and unwinding at a beachfront or exploring the local area by night offers professionals several advantages of productivity.

NACM’s Credit Congress & Exposition started with a mission to join credit professionals together from across the nation for networking, educational seminars and forums with information about the latest changes in the credit world. This year marked NACM’s 127^th annual Credit Congress in Grapevine, TX, with nearly 1,200 attendees present. And next year’s 128th Credit Congress will be held in Las Vegas, NV from June 9-12, 2024.

Out of all Credit Congresses held, Las Vegas is one destination that stands out more than others to most credit professionals. The last time NACM held Credit Congress in Vegas was nearly seven years ago. “I’ve only been to Las Vegas once, and it was for my very first Credit Congress in 2016,” said Penny Jeter, CBF, NACM Board director and director of credit at Ingram Industries (Nashville, TN). “The location is amazing and there are so many opportunities outside of the seminars to engage with other credit professionals. It’s lots of learning by day, networking in the evenings and no sleep from having way too much fun!”

Attending any business conference in Las Vegas can be a unique experience, especially for those who have never visited the city. Here are five reasons why you won’t want to miss this incredible education opportunity in the entertainment capital of the world:

1. Networking Opportunities

Credit Congress brings credit professionals from all over the country from various industries, experience and backgrounds. It is the biggest networking event in the B2B credit industry. “I usually bring one of my employees with me to Credit Congress, but Las Vegas was one of the first conferences I went to by myself,” said Sheryl Rasmusson, CCE, president at Kilgore TEC Products (Spokane, WA). “I got to meet someone else who also came by themselves, and we became lifelong friends. She’s a part of my network and community of people I’d reach out to for important questions regarding NACM. I extended my hand out and built a relationship that now is part of my life professionally and personally.”

2. Entertainment Options

As you can imagine, there is always something to do in the city. Bright lights, shows, concerts, casinos and the famous Las Vegas Strip are just a few entertainment options to name. “The entertainment doesn’t stop because it is 24/7,” said Valerie Novakoski, credit manager at Southern Agricultural Insecticides, Inc. (Palmetto, FL). “The educational sessions are amazing and once the conference is done for the day, I am exploring what Las Vegas has to offer. Vegas always has a ton of shows and restaurants. There is never a dull moment.”

3. Luxury Stay

With business by day, and entertainment by night, it is important to get all the rest you can. In Las Vegas, attendees can stay at the glorious Caesars Palace—one of the most luxurious hotels on the Strip: and the Credit Congress host hotel. The amenities, food options and aesthetic are some of Rasmusson’s favorite parts of the hotel. “An air of fun just hits you as soon as you land,” she said. “Caesars is a gorgeous place to be and one of the most enticing things that draws me to Las Vegas over any other locations.”

4. Educational Opportunities

With several sessions throughout the four-day stay, credit professionals are able to learn about the latest trends in the credit profession and strengthen connections with others who may face similar challenges in their industry. “The sessions are always helpful and on point with what is going on in the world at the time,” said Novakoski. “Applying knowledge you take away from each session makes it all worth it. Going to conferences such as Credit Congress provides the most diverse education available.”

New this year, revolutionize the way you lead with the two-day Executive Leadership Workshop while at Credit Congress. In the sessions, you’ll learn practical ways to serve and build healthy teams in your organization and how to create a culture that puts people first.

5. Expo Hall

Exhibitors will be available at the Solutions Hub during Expo hours to present demos, corporate introductions, mini sessions and Q&A sessions in 20-minute segments. Choose the demonstrations you would like to visit during your time in the Expo Hall. The Solutions Hub is a casual, small audience experience located in a specially designated area of the Expo Hall. “On the business side of things, the tradeshow is always a big hit because we get to learn more about new products,” said Rasmusson. “For me, that’s a big drawing factor of the tradeshow. The whole environment provides excitement.”

Overall, Las Vegas is the perfect backdrop for Credit Congress. You can be a credit professional by day and a vacationer by night. Not only does the conference offer valuable professional development, but a wide range of entertaining and memorable experiences.

For more information on registration, please visit our website. Early bird pricing at $849 is available until Dec. 8. First-time attendees can register with a full-paid delegate for $249. The Executive Leadership Workshop is available to the first 50 registrants for an additional fee of $399.

Burnout has become a corporate vampire, draining the life out of employees through emotional exhaustion and lost productivity. By understanding the causes of and the preventative measures for burnout, credit professionals can maintain the physical and mental well-being of their credit team as well as improve performance in the workplace.

What Is Workplace Burnout?

According to the World Health Organization (WHO), burnout is an occupational phenomenon, a syndrome conceptualized as resulting from chronic workplace stress that has not been successfully managed and characterized by three dimensions:

• Feelings of energy depletion or exhaustion
• Increased mental distance from one’s job, or feelings of negativism or cynicism related to one's job
• Reduced professional efficacy

Studies show an increase in workplace stress with 77% of workers reporting experiencing work-related stress in April, per the American Psychological Association (APA). While 57% indicated experiencing negative impacts because of work-related stress that are sometimes associated with workplace burnout, such as:

• Emotional exhaustion (31%)
• Didn’t feel motivated to do their very best (26%)
• A desire to keep to themselves (25%)
• A desire to quit (23%)
• Lower productivity (20%)
• Irritability or anger with coworkers and customers (19%)
• Feelings of being ineffective (18%)

Workplace burnout has an array of negative organizational, psychological and physical consequences, according to APA. Organizational consequences come in the form of absenteeism, job dissatisfaction and presenteeism, a loss of productivity that occurs when employees are not fully functioning in the workplace because of an illness, injury or other condition.

Recognizing Workplace Burnout

A sudden increase in workload can lead to burnout, especially when there are not enough resources to carry the extra weight. Sherry Bushman, director of credit and collections at Partners Personnel (Santa Barbara, CA) noticed burnout in her team this year during an acquisition where they had to ensure everything was set up correctly in the system. “Some people even started working more overtime to finish the project,” she said. But overtime does not always equal more productivity.

Workplace burnout can be more prevalent during specific times of the year. For Michael Barnidge, CCE, CICP, credit director at Quality Bicycle Products (Bloomington, MN), burnout is more prevalent from April through October. “At the start of the season, the team works hard in setting credit limits and getting orders out the door, especially during the summer when a lot of staff members are out on vacation,” he said. “We also have to make sure that we get paid before the fall and winter seasons where there's not as much cash flow.”

Heightened negativity and cynicism are clear indicators of burnout with credit professionals, especially in toxic work cultures. Barnidge would see a decline in staff’s patience and willingness to navigate challenging discussions as a sign of burnout. “I’d hear about frustrations about workload and inter-departmental drama, especially between the credit department and the sales team,” Barnidge said.

How to Prevent Burnout

Preparation

Planning not only prevents burnout, but it helps you achieve short- and long-term goals. Barnidge prepares his team for the following quarters or months ahead. “This way I know what is going to be required of me and my credit team and I prepare for the potential challenges so that when they do come, they’re not a surprise,” he said. “During those challenging periods, we have days off or just extra time in the day to reflect or level set to stay calm. Sometimes we take more breaks or have more conversations to work on relationships and relieve stress.”

Schedule Flexibility

It’s possible to still experience burnout doing something you love if you don’t take the time to recharge. Having that work-life balance will not only prevent burnout but boost productivity in the workplace. “It’s important to set time aside to recharge because if you don't take care of yourself and let the stress build up, you can't take care of anything else around you,” said Brett Wegner, senior manager-accounts receivable at Post Consumer Brands (Lakeville, MN).

Bushman allows for schedule flexibility so that her staff stays motivated and oversee their own time. “I let my staff run errands or tackle family responsibilities during the day so long as the work gets done and there’s someone to take over during that time period,” she said. “Because credit team is remote, I hold daily morning calls to touch base with them.”

Prioritize Self-Care

Self-care looks different for everyone. It can mean allowing staff to improve whether that is professionally or personally. This can be in the form of team meditation, yoga or exercise. Buchman’s company has a weekly book club for personal growth where members from different departments discuss a chapter from a book and share personal experiences. “We also find ways we can help one another or make suggestions on how to improve personally and professionally,” she explained.

Setting Boundaries

Establishing clear boundaries at work, such as defining work hours and personal time, can act as a safeguard against workplace burnout by preserving a healthy work-life balance. “If your boundaries aren’t working, it may be time to look around and see if the work environment you’re in is conducive to the life you want,” said Kelsie Gradin, AR specialist at Outdoor Research (Seattle, WA). “I’m lucky to have found a workplace that does the same. After experiencing burnout from a previous employer, I found that advocating for yourself can be one of the hardest but most rewarding things you can do.”

Open Communication

Maintaining open communication with your staff makes them more comfortable asking for help if they are feeling overwhelmed or burnt out. “I speak to the person candidly and ask if there’s something going on because I don't want to assume that it's work overload,” Bushman said. “I ask if there's something I can do like hire more people if there’s an uptick in workload. This allows credit staff to have that work-life balance, especially since most of them have families.”

The causes of burnout will vary depending upon the individual and may not always be directly linked to the workplace. “People may appear as though they're burning out due to work, but really, they've got some unresolved life experiences or struggles that they haven’t reconciled that are affecting their ability to perform at work,” Wegner said. “Once you recognize that, you can make a positive impact in that person's life, even if it’s just listening to their story. You can also ask if they need somebody to step in or need a change in workload.”

Protecting security interests is essential for creditors to secure their rights and claims in the event of a debtor’s default or bankruptcy, ensuring the collateral serves as a valuable asset to satisfy debt. To do so, trade creditors can file a Uniform Commercial Code lien, also known as a UCC filing, a legal document that serves as a public notice of a secured transaction, providing information about a creditor’s interest in the debtor’s personal property collateral.

For trade creditors, the security agreement is often a standalone document. Eve Sahnow, CCE, corporate credit manager at OrePac Holding Company DBA OrePac Building Products (Wilsonville, OR), went a different route and decided to add security language to her credit application in addition to devising a standalone security agreement or UCC filing. Sahnow turned to NACM’s Secured Transaction Services (STS) guru Chris Ring for advice; Chris shared a template of a security agreement to her to use as a starting point. Together with her attorney, Eve found a way to incorporate security agreement language into company’s credit application. Once a customer signs the credit application, Eve can proceed with asking STS to complete a UCC filing.

“We were trying to diversify our offerings in how we extend credit,” Sahnow said. “We have our underwriting process, which includes industry standards of credit references and risk management. But we wanted to add another layer above credit insurance and job accounts.”

Chris Birdwell, credit strategies manager at Pioneer Balloon Company (Wichita, KS), had completed UCC blanket filings. “I asked NACM’s Secured Transaction Services to do some refining and make it a standalone agreement to include inventory for a PMSI,” he said. “The UCC1 is just another level of security or credit insurance for your customers and yourself. On a couple occasions, customers had warehouse fires and lost inventory of our product, but because we were secured, we worked with the insurance company to replenish their inventory immediately.”

The only challenge that comes with using or implementing a UCC1 as a standalone security agreement is the customer’s inability to comply for fear or lack of knowledge. “If they're hesitant, tell them it gives them extra security,” Birdwell said. “I use that as a leverage to have them agree to signing and it makes it easier for credit professionals to go over their credit limit if needed. If the unthinkable were to happen, it’s expensive and something that every creditor should look at, especially if their product is recognizable and in high demand.”

Difference Between Mechanic’s (Construction) Liens and UCC Liens

One of the main differences between a mechanics lien and UCC liens is consent. A mechanic’s lien is a risk mitigator of payment to builders, contractors and construction firms that build or repair structures. Mechanic's liens also extend to suppliers of materials and subcontractors and cover building repairs and ensures that the workmen are paid before anyone else in the event of a liquidation.

“With mechanic’s liens, the security interest is written into the state statute which determines whether or not you have lien rights and if they comply with the statute to enforce your lien rights—you don’t need consent,” said Chris Ring said. “But with UCC filings, the security interest is granted by your customer and that acceptance comes in the form of a security agreement with specific security language, also known as a UCC Financing Statement (Form UCC1), that allows you to have a security interest in your customer's personal assets.”