Why You Need To Protect Your Small Business Credit Line
Whether you are a firm owner of a hardware stores, publishing shops, or gas stations, how do you go about to protect against business mal-practices? If you own a small firm chances are you’ve probably established some credit lines with local vendors. If you have a company that has workers then you may have to trust other people to use those credit lines on your behalf.
Businesses frequently have employees such as delivery drivers, someone who submits their invoice to be reimbursed. Some people that are trusted to pick up materials from time to time. For example if you own a carpentry shop, plumbing company or other such business. You are the boss and you often need things but you don’t have the time to be running out to the store every time a person in your shop needs something. So then the apparent solution is you direct someone to go out and do it. Unless you want to give that person cash every time you need something you have already established some sort of business credit line.
Commonly the company the credit line will have the person picking up the item sign a receipt to acknowledge the payment for their records and then give a second copy to your employee. It is your worker’s responsibility to give you that copy so you can pay the bill when it is due. Over time as the person doing your shopping becomes known to your suppliers, then the opportunity for misuse manifests itself.
When it is time for you to the bill, you should make careful notes about it. This is your chance to check and see if any other suspicious event is taking place. Check the invoice for unusual information and things like the date the purchase was made and if included on the invoice what time did they make the purchase? Was the purchase made during normal business hours or was it after? Often such bad purchases are made on a weekend. People that abuse your trust many times will try to do things after hours and tell the vendor about working late.
There are particular things you can do to avoid the problem. Most vendors maintain a card of official signors from your company. That way if you see a signature you do not know the vendor can be held reliable for allowing the payment. It will still be your duty to handle the employee and their conduct. You can also request the vendor to send copies of all invoices to you so that you can verify all purchases. You can make it known to all employees that you do check all the bills and expenses from your vendors but don’t make it sound so threatening though.
Nearly all employees would never consider abusing the faith given to them by an employer but there are always certain people that feel they can slip one over on the boss. They could want to get back at you due to not giving them a raise, or being disappointed about some outcome. The point of course is that it does happen and it’s better to be safe than sorry in the future.
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