# Net 30 Approval Process?



## dbcom (Jan 17, 2007)

Hi, just wondering if anyone can shed light on how to process a Net 30 application from a wholesaler.

I know what I need to ask for in the application, but I'm not sure how to go about checking references and running a credit check on a buyer? How does that work? Any other possible website leads?

TIA


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## pikeman (May 2, 2008)

Your question isn't real clear. If you looking to extend credit to someone and want to check their references, most wholesalers require you to fax them a form to check credit references listed by the credit applicant. You'll want to know how long they've had credit with that company, their average days to pay, high credit limit and current amount owed and are they current.
Most every wholesaler in this industry belongs to NACM or National Assoc. of Credit Management. NACM - National Association of Credit Management This allows them to share info about their customer pay habits, NSF checks high credit limits and such. They are not supposed to share this info with their sales departments.


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## dbcom (Jan 17, 2007)

Pikeman, sorry for the vague question as this is completely new to me...and pardon my complete ignorance on this. But I'm eager to learn what I need to do.

What would be the proper protocol for contacting the references? Do I call the reference by phone and talk or do I need to send the reference another form for them to fill out and fax/mail back? Is this just a simple letter exchange?

Also, when a client submits banking info, do I simply submit a letter with the attached client banking info/signature asking for a credit check? 

I've never heard of NACM until now. Is it really necessary to join? Yet another association to pay fees to?


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## pikeman (May 2, 2008)

It all depends on the references you are contacting. If you are contacting one of the large wholesaler such as Broder, San Mar or TSC you will most likely be told to fax your request. Others may be less formal. You are just requesting info on your potential customers pay habits in order to make your own decision about extending them credit. Banking info works the same. Just call the bank and ask. Most are small business friendly and will tell you how to go about getting the info you need. Your bank should be very helpful here too. Its in their best interest to look out for you. Be honest with them and tell them what you are trying to do. Have a sit down conversation with your banks business manager. 

NACM is a great organization. You only need to be a part of it if you plan on extending a lot of credit.

Why are you looking to extend credit to someone? Is it a prereq. to doing business with them? Have you asked them to pay COD or even 50% down & 50% upon delivery? These are common terms. Net terms are for the big boys who are well capitalized.


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## selfexplanitory (Dec 29, 2007)

CreditBoards -> Business Credit


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## dbcom (Jan 17, 2007)

Thanks for the link, selfexplanitory.

pikeman, i'm asking myself those last questions you posed. I've asked the prospective client to pay up front for the initial order, but will now ask them to do so as policy for any and all transactions.


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