Talking about the weather in a customer’s area, how their kids are doing and what they’re having for dinner might inspire debtors in urban parts of the United States, especially the Northeast, to be impatient or even to seek an end to the conversation. However, in Latin America, failing to do so with some regularity will almost certainly downgrade the position of one’s company when it comes to whom debtors will pay in timely fashion when liquidity is a problem, said a breakout panel of credit experts at FCIB’s 25th Annual Global Credit Conference this week.
Moderator Alessia Zalambani, CBA, ICCE, corporate credit manager at Domino Foods Inc., was first to note the importance of building and maintaining a business and personal relationship with customers in many Latin-based countries. “If they have the choice between buying from you or paying you or someone else, the relationship is so important,” she said.
This could become particularly important in the coming year, as Latin America’s recent hot performance could be counteracted at least somewhat by a number of problem situations: non-diverse product and service options beyond the natural resources sector at a time when Chinese demand is slowing dramatically (virtually every Latin nation except Brazil and Mexico), growing anti-US sentiment (Bolivia, Argentina), national elections between candidates with vastly different views on the business community (Brazil), poor FX holdings (Venezuela) and increasing pushback for debtor-favorable terms (Mexico).
Baltimore Aircoil Company Inc., Global Credit and Collections Director Sean Papperman noted that once delinquency has crept into a payment situation, it’s too late. “The sooner you set up the relationship, the better, and you have to refresh it—you can’t afford not to,” Papperman said.
- Brian Shappell, CBA, CICP, NACM staff writer
The extended version of this story will be available in this week's edition of eNews, available late Thursday afternoon at www.nacm.org.