CHAPTER XXIII 

 CREDITS AND COLLECTIONS 



A. THE CREDIT MAN 



The concern selling goods on the credit system to other 

 concerns or to individuals should be in a position to form an 

 opinion of, or to obtain reliable information as to, the responsi- 

 bility of the purchasers in question. Such information is 

 suppUed to the sales department by the credit man. It matters 

 not whether the firm has a separately established credit de- 

 partment, the credit man may be the creamery manager who, 

 as in a small plant, may also be the butter maker, but a credit 

 man must necessarily be there. If he is omitted, the business 

 concern must in safety confine its sales only to cash sales. 



The ability of the man who is to pass on credits is a big factor 

 in the successful operation of any large business. In general 

 business is based upon credit; only few concerns can pay cash 

 for all purchases. Therefore a credit man who can safely allow 

 credit to 99 per cent of the people entitled thereto will be of 

 greater value to his firm than the one who is allowing credit to 

 only 95 per cent. 



The credit man should have a knowledge of the general finan- 

 cial conditions and of the factors affecting such conditions. 

 If a labor strike is started in a certain locality he should be able 

 to determine the effect of such a strike on the responsibility of 

 firms in that locality with which he may be doing business. 

 Depression will always follow a crop failure, therefore in a dis- 

 trict where a crop failure has been experienced it may be advis- 

 able to take special precautions and decrease the amount of 

 credit allowed, whereas more liberal credit may be allowed in 

 sections where the crops have been .exceptionally good. 



Full information should be obtained in reference to the 



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