Page:Roy Ralph Hottman - Practical Collection Procedure (1923).pdf/21



Basis for Extending Credit.

When credit is to be extended there are many factors to be considered, such as the applicant’s integrity, ability, character, financial responsibility, location of the store, local conditions, crops, competition, general business con- ditions, references, etc. It would be unwise to extend credit merely upon the strength of any one of these es- sentials for they are so closely interwoven that they all contribute to success in business.

Honesty and integrity are, however, absolutely necessary. Any credit man ig justified in approving orders up to a certain limit if there is no other qualification whatever than that of honesty. However, he ge clearly when th limit has been reached and when-te-refuse further eredit. For the sterling character, the honest man, may be weak financially, or he may have poor sro or too close compe- tition in comparison with his y, and if he find him- self eventually too deeply involved, he simply hasn’t the means to settle his accounts. The best intentions in the world, coupled with integrity, have been, and will con- tinue to be, wrecked on the shoals of business whenever other essentials are not joined to them. If the honest man becomes too deeply involved, what other course is