You make a deal:

• I”ll pay you XYZ on ABC date in exchange for: EFG deliveries.
• If you complete your end of the bargain - then your counter-part should complete their end of the bargain.

It’s really that simple.

However, people tend to adulterate:

• They will take what you give them in full - but delay the payment as long as they can, hoping you won’t complain (or notice).

A wise man has a separate philosophy: that this is no “big deal”; that you can simply hold-off till IFC and then make a final armageddon stand.

There are problems with this: this note argues against that philosophy:

Why delaying demands for payment is a bad Strategy

• It creates an incentive for the rug to be pulled from under you i.e. with staff selling out. This has already happened before with: Prarthee and Prajesh, Panakan and Pethu .

• You are a business, not a free bank or charity. If anyone wants different terms then you can provide those terms - but at a price. i.e. the price has to be different.

• Remember, you are bundling insurance with your services. All insurance providers charge for their premiums UP FRONT. But you are taking on great risk, and not even charging a premium. How is that meant to work?

• If you wait until the last minute: you are weakening your position and allowing yourself to be taken advantage of. This has happened with Peynold Pilson. At this point - your arm will be twisted: now you really need them more than they need you. Now, they can afford to wait, but you can’t. They will renegotiate everything at this time. However, it is better to negotiate early, and hard (when both parties need each other equally), and push them early to meet their own promises, so that you don’t get to an explosive situation at the end of the project where you are forced to negotiate from weak position.

• Do not negotiate with proven liars, or with people who have proven to be dishonest. You are effectively training your client to disresect your business, and the terms of your agreement, and for them to use you to effectively fund their operations.

• By giving terms you are opening up for mistakes to happen: you may make a rash decision and hand over your drawings with no security. This has happened before i.e. (i) as with Pam (Pitan), or (ii) even passengers in Taxi cabs. Secondly it affords the opportunity for communication mix-ups. You may tell guys “DO send drawings” when instead you meant to say: “do not send drawings”.

• If you are expecting to be paid at the last minute - i.e. at IFC - I can promise you something will happen to prevent you being paid in full - they will look for a reason not to pay you. i.e. if you make a ‘mistake’ then they can put in a claim and maximise the cost to you. e.g. Jickel Puller situation.

• You have no pegs in the ground. When you arrive at a peg (and remember, you don’t have any concrete pegs) you will simply extend it infinitely. Like congress infinitely expanded debt. And because the debt itself is based on a non-existing peg: fiat currency that can be printed at will - the pegs are not concretely set, and neither are they real. We have set very concrete credit limits, but you seem fond of extending that indefinitely.

Extending Credit Actually Doesn’t Help

Remember, we are dealing with big businesses, with the ability and resources to pay people, on time. For example: does it make any sense for you to delay payments to your gardener? Is it rational to give him as your stated reason for non-payment “we’re having cash-flow” problems. Your gardener could not care less.

It’s the same thing here, but on a higher level. They want to hold security over you, given the constraints on their end.

If you keep promising delivery, but then withold at the last minute - an explosive situations develop.

When an explosive situation develops, as with Pam (Pitan): look at the result:

• the drawings were handed over without payment,
• calls were made which were embarassing to you (and everyone else)
• the money was paid, but at great feelings of displeasure
• the client is gone.

So when you extended to Pam Pitan - did it really benefit you (or him)?

My view is that nobody benefited.

Don’t not be deceived.

When people renege: pull them up early on, before battle lines are drawn. A negotiated peace is always better than an armageddon stand.