The Credit Game And You

Part One

You likely have read recently about the ethics of the large banks that were bailed out by you and me…the taxpayers. In fact President Obama is now talking about putting restrictions on the large banks to hopefully prevent this type of catastrophe from occurring again.

Meanwhile, most of our personal credit activities have taken a hit in the last year. You may have experienced this through difficulty in getting a loan or changes in your credit card rules and rates. In fact you might be asking yourself, “What did I do to make my credit card company hate me?” Maybe you’ve had your card limits lowered, or even had some cards canceled for no apparent reason. You have made all your payments on time, and you can’t remember doing anything unusual to have caused such an action against you.

The management team at The Silkin Management Group attempts to watch these activities for its clients in order to offer logical advice. The great majority of Silkin Management Group’s clients are in the health care profession and, as such, their credit ratings are often vital to the operation of their business. Having good credit is vital in getting a lease or loan for new equipment, expanding an existing office or building or buying a new facility.

Unless you’ve been living the last year or so living in an endangered oak tree as a guerilla environmentalist, you are aware that the credit climate in the country has changed. This is not new news. However, it was only recently that FICO, the service most widely used to determine one’s credit-worthiness, has released information about how they arrive at the hallowed number. This is the first time they have opened their secret vault of formulas, calculations, and criteria to the great masses.

Also, Silkin Management Group is a leading vendor for several major lenders to the health care profession. As such we have extensive experience in this field and can help you with understanding this industry and activity as well as aid you in obtaining financing for business needs.

Part 2 of this article will be posted here on January 29th. In Part 2 I’ll go over some of the specifics I’ve found from FICO opening up their secret vault. You’ll find it useful, educational and hopefully helpful in being proactive with your credit rating.

If you’d like more information about Silkin Management Group and its services, visit our website at: www.silkinmanagementgroup.com. You can also email us at: info@silkinmanagementgroup.com

Lyn Ribisi
Appointment Coordinator,
Silkin Management Group

HELP FOR SMALL BUSINESSES IS GREAT, BUT WHERE DOES THE MONEY COME FROM?

In today’s New York Times, I read the following editorial about needed help for small businesses.Help Small Businesses Hire again.

As a management consultant at Silkin Management Group, I consult our clients with the workable management technology that helps their business grow, even during these tough economic times. Silkin clients are all primarily single doctor owned health care practices such as dentists, veterinarians and optometrists. As such they are all small businesses in the truest sense of the word and anything that affects small businesses affects them. That’s why I found this article interesting.

The author points out those businesses with fewer than 20 employees account for 25 percent of all jobs, and that these same small businesses created 40 percent of the job growth during the 2003 to 2007 economic expansion. I know that our Silkin clients had something to do with that because, as they learned to become effective managers, their productivity grew and the need for more staff increased in order to keep up with the increased productivity. Expansion for our clients is the primary goal of Silkin Management Group and, as consultants, that’s what we are expected to produce. With that viewpoint, I fully back any ideas and methods to help small businesses and that’s why this article caught my attention.

But reading further through the article I found some seriously strange concepts. I thought it was a positive note to promote the concept of making it easier for small business to obtain needed credit, and the author discusses why this is still very difficult, despite the President’s recent statements otherwise. But then the author puts out some concepts that frankly seemed strange including refunds for taxes paid in the past in exchange for higher taxes in the future and work share programs paid for by the government. Interesting ideas, but where does the money come from to pay for all this? He doesn’t say anything about this.

At Silkin Management Group we try to teach our clients fiscal responsibility. This would include the very basic idea of not spending more than you make and running very tight budgetary controls. These are not esoteric management concepts. The Silkin clients who apply these basic principals do well financially. The government, and many economists who write columns such as this one, don’t seem to think that such a basic concept has anything to do with government.

You know as well as I do that if you keep spending more than you make, and you keep borrowing and borrowing money, it will catch up with you and take you out. Why would this be any different for the government, other than the fact that they can print as much money as they want in order to have the money needed? But that activity just leads to inflation. All you have to do is look at the price of any commodity 50 years ago compared to today to see the truth of that.

So, as a management consultant for small business at Silkin Management Group, I appreciate the author’s concern for small business. But I also must express that any help must follow basic and workable management technology and not include more and more borrowing, more and more inflationary activities and less and less fiscal responsibility.

I’d love to hear your opinion about this article and my point of view on it.

For more information about Silkin Management Group, visit our website at: silkinmanagementgroup.com or email us at info@silkinmanagementgroup.com

Bill Hickey
Silkin Management Group Consultant

Visit our other blog at: SilkinManagementGroup.Blogspot.com

Extending Credit: Tips to Control Your Accounts Receivable

Assess the patient/client's credit worthiness before extending any sort of credit. Have them fill out a "credit application" (see sample in the Form section,) and verify the information supplied.

Always charge for any credit extended, using a monthly percentage or a flat service fee.

When extending credit of any kind, have the patient/client sign an agreement covering the terms of the credit. Ensure that they fully understand and agree to the terms of payment.

Monitor all accounts monthly so that you know who may be delinquent. Take immediate action on any account over 30 days past due. The older an account gets, the more difficult it will be to collect. Call the patient/client right away and make arrangements to bring the account current.

Flag past due accounts by putting a red self-adhesive dot on the upper right corner of the patient/client's chart folder. In this way it is easier for any staff person to see that the patient/client has a past due account and it will be more likely to get addressed.

Each day review the schedule for the next day so that you will be prepared to see any patients/clients whose accounts need addressing. Confer with the receptionist on anyone who will need to be seen after their appointment, or from whom the receptionist would collect over-the counter.

If a patient/client you had planned to collect from has forgotten his/her checkbook or does not have the agreed upon amount, the receptionist should contact the accounts manager or the office manager so that the matter can be addressed.

Patients/clients with delinquent accounts, who are not making an attempt to handle it, should be sent to a collection agency. Again, this should be done as soon as possible before the account gets too old to realistically expect payment.

Ensure that statements are accurate and are being mailed out every month on time and without fail. Utilize appropriate labels on the statements such as: "Thank you for your payment."

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