The T word

There is hardly a news story now not centred around the R word - the economic reality that started as a slow-down, grew quickly to be an acknowledged recession, and for some particularly lugubrious columnists, is darkly hinted at a possible depression. But to stay with the majority, let's call it by the R word. Working, as I do, writing about and sometimes for business, I am acutely aware of the multifarious ways that the R word is impacting on the culture and behaviour of businesses affected by the nervousness, strangled cashflow and retrenchment that fills the corporate air now. 

Lymehound works for a range of businesses in different stages of their lifecycle: some are babies at that fragile point when idea blooms into reality; others are mature and street-savvy, playing the media, ducking and diving. Like any other business, we have to collect debts to survive, and we have been very lucky in having honourable, well-meaning clients who, because they're pretty happy with what we do, pay us on time or thereabouts. We know that sometimes that has been at personal cost, and we appreciate it all the more because of that. We do the same. Why? Because we have an instinctive knowledge that we should act as we want to be acted on, so to speak. 

Interestingly, the only real problem we, as a new media company, has had in collecting our debts, has been with our biggest and oldest client. This client is one I have known personally for many years, and one I admire. It never occurred to me that this high-profile, well-established, highly-appreciative firm should be our one late payer. I left it a while. But when I was getting no replies to emails or phone calls, I started to worry. Here was a vibrant, savvy firm, led by a high-profile CEO who speaks with gung-ho positivity at numerous events and conferences, who would regularly email me perhaps six or ten times a day, simply going silent on me. I decided that I couldn't sensibly continue to work without communication and said so. And today, she called me to tell me she can't afford to work with someone who needs to be paid on an agreed timeline. It was kind of my fault for having the unreasonable expectation of getting paid in a vaguely timely fashion.

Now I'm a grown-up and know there will be many business relationships that for all sorts of reasons come to an end. But what upset me about this wasn't the fact that Lymehound was being sacked (incidentally in open violation of a contract, initiated and signed by the client only weeks ago) but the absolute breaking of trust. "Trust men and they will be true to you," said Ralph Waldo Emerson. Trust is so much more valuable than legal contracts. Trust is what makes you bust your gut for a client; over-deliver; introduce them to valuable business contacts without any payback or chance of payback. Trust has to do with a feeling that you understand the lay of the land and you are working to do something important together. Trust stops you billing for every hour, every train journey and expense. Trust makes the world go round. 

When  you can't pay a supplier, call him. Ideally call him before he calls you. Tell him how it is. Don't suggest it's unreasonable to expect payment or any other game you might play. Just level with him and keep close. You may think you can do without your suppliers - plenty out there clamouring for your business. But at some stage, maybe next month, maybe next year, you're going to need business relationships that are based on trust. If you've forgotten that, the R word may be the least of your worries.