One aspect of our wholesale business was the opportunity to learn about other communities, in various ways. I discovered, during my tenure there, that we had a pair of customers, in two different states, that mirrored each other, in an unusual way.
One pair was in downtown Beaufort, SC; the other was on St. Simons Island, GA, in the old pier district.
Both towns had a long-established family-owned hardware store occupying a two-story building in their central business district; and a block down the street from both was a one-story building that had a smaller hardware store, owned and operated by a retired Marine. What’s more, both those smaller stores eventually closed, and later turned into beachwear shops. Now, what’s the chances of that happening? Very small, I’d say. The two-story business in the pier district of St. Simons Island is still in operation, I’m happy to say. The two-story business in downtown Beaufort finally closed, a few years ago, and turned into a flea market for several years, before being sold to a developer for other uses. I’m not sure if that part has taken place yet. What an unlikely coincidence. I only happen to be aware of it because my family business was a longtime supplier to all four of them, and I have visited all four, and knew the stories behind them. Life is full of surprises! One other aspect of my position as Credit Manager was occasionally having to deal with past-due customers. I saw it happen, more than once, and in more than one community, that a business sometimes opened up and did very well, but grew very fast – and then ran into trouble when tough times hit. “Too fast, too soon.”
One such customer was a fellow who retired from a long-time job in Macon, and moved to a small town southeast of there with his wife. He told me he had always wanted to own a hardware store, so that’s what he did, opening one in a vacant storefront on the town square across from the county courthouse, where his wife now worked as tax commissioner.
The problem he ran into was, the biggest business in town was a small private college, who was happy to buy from him, but wanted to buy on credit – and their cash flow such that he often wouldn’t get paid for 90 days. Which meant we didn’t get paid for 90 days, or more, either, as he didn’t have the capital to pay us on time while he waited for his credit customers to pay him. Our policy was that we suspended credit to any account that got 90 days behind; and if our salesman could not collect the bill, I would get in my car and go pay them a visit. The first time that happened with this particular customer, he only owed us $1,500, a relatively small amount. I happened to arrive just about lunch time, and it just so happened that his wife walked into the store a few minutes after I did. “Mr. B” turned to her with a big smile, and asked sweetly, “Honey, may I borrow $1,500 from you to pay this nice gentleman from Savannah?” I was embarrassed to be put in the middle of that situation, but when she pulled out her checkbook and wrote me a check on her farm account, I was glad to get it. I am sure he got quite an earful when they got home that night.
Nice fellow, just tight cash flow. And under-capitalized.
A couple of years later, his business having recovered, we had reinstated his credit privileges, and then he got behind again, and couldn’t pay. This time, I told our salesman (who was paid on commission) to go by and see what merchandise he could have picked up and returned for credit, to reduce the balance owed – which at the time was about $14,000.
He did that, and between returned merchandise and periodic payments over the next year, the fellow only owed us about $4,000 when he closed his doors and filed for bankruptcy. I regretfully sent the salesman a note to tell him we would have to reduce his next commission check by the $1,400 or so he would have earned on that $4,000 we had to write off.
To my surprise and astonishment, he showed up in my office a few days later, with a bottle of Glen Livet Scotch!
I didn’t even know what that was. He told me it was expensive scotch, you had to slip it slowly to make it last, and it was his “thank you” to me for helping him with that account.
“But we wound up taking a loss of $4,000 on that account, and I had to charge you back the $1,400 commission on that!” I said, surprised. “I don’t understand.”
“You got him down from $14,000 to $4000, before he closed!” he exclaimed.
“That could have cost me $5,000 in commissions, instead of $1,400! So I am very appreciative.”
It took me a year to sip that bottle of scotch, down to the last drop. And I thoroughly enjoyed it.
That fellow is now mayor of a small town just northwest of Savannah.
People will surprise you.
Rafe Semmes is a native of Savannah and a proud graduate of (the “original”) Savannah High School on Washington Avenue and the University of Georgia. He has resided in Liberty County since 1986, where he and his wife share their halfacre with six cats and assorted wildlife.