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Taken advantage of in business with friend

Tagged as: Friends, Troubled relationships<< Previous question   Next question >>
Question - (30 January 2014) 9 Answers - (Newest, 30 January 2014)
A female Australia age 41-50, *upid lover writes:

Hi all,

I have a problem with a friend that I have known since I was 12 yrs old.

Recently she opened a shop and as I have a manufacturing business she asked me if I had any excess stock that she could put in her store on consignment. For those who don't know this simply means that she doesn't have to pay me anything until the stock sells. So it is a super arrangement for her- filling up her shop at no cost. She takes 40% of the retail cost.

Since the end of April I have been supplying her and have sent more and more stock as sales were going quite well.

In September '13 I went overseas and while I was there decided to extend my trip. Everything has been fine between us and running smoothly and we have always been great friends.

Then after me being away for about a month she wrote to me askin when would I be back. I said I wasn't sure but no more than three months in total because of VISA matters. She told me that the day after Xmas gets super busy so I said I would make sure that I had loads of stock sent to her before then so she was set for the Xmas, new year period. Which I did.

Since October, I have not had replies to emails or text messages for days at a time when it used to be immediate. Also, she wrote to me 3 times when I was away saying that she was jealous that I was away. I wasn't aware that at this time she was pregnant with her 2nd. She didn't tell me she was pregnant either. I found out on her wall on Facebook which I check probably 3 times a year and all of my friends know that.

I find it weird that we were communicating at least 3 times per month and she didn't tell me that she was expecting.

I wrote to her one day via text with a question about stock levels and never got a reply. So I decided to leave it and there was no communication for about 3 weeks. Then I got a text asking when I was sending more stock!! She also stopped paying on time and I had to chase up a few times and she said that she pay within 7 days when she usually pays immediately.

I also found out that some of the stok was in storage and not even out on shelves for 2 whole months! Then I recently aske for it to be sent back as another customer wanted it and when I recieved it there were 10 pieces missing. I emailed her straight away and asked her to look for them and she said that getting to the post office to send the stock was really hard for her and that if she gets time she will check. I haven't heard from her since then and that was 3.5 weeks ago.

As I thought Xmas was going to be super busy I sent her approx $6000 worth of stock so she was set. The sales at the end of December were terrible an so now there is a lot of stock sitting in her shop which I could be distributing among my stores that sell and want the stock and who actually communicate with me!!!

I have been trying to contact her via text and email for 2 days now and no reply.

I understand why people say friends and business are a bad mix.

I feel like I am being unappreciated but also punished for going away overseas. It seems as though it is obvious that I would give her the stock and be treated badly too! I actually can't believe her behaviour. What she doesn't realise is that I could easily walk into the shop and take all of my stock and she would only have half a shop left. She is my in control. But then I would be the horrible person who took all of the stock back when she was 5 months pregnant.

Any opinions, advice or ideas here?

View related questions: facebook, jealous, period, text

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A male reader, Serpico United States +, writes (30 January 2014):

The key to any long term business relationship is an iron clad partnership agreement. That way, all the expectations are laid out up front and in writing. This should be put in place no matter if the business partner is family, friend, or stranger.

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A male reader, Myau New Zealand +, writes (30 January 2014):

Myau agony auntIts time for a sit down. You both need to talk this out, face to face as friends, not as client and supplier.

Try to be understanding and not trying to solve her problems.

Her business might not be doing well. That would explain why she is late paying you. Her jealousy might also be due to her having unrealistic expectations of how profitable her business would be.

But if things continue on as they are you will lose a friend.

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A female reader, cupid lover Australia +, writes (30 January 2014):

cupid lover is verified as being by the original poster of the question

Thank you all for your advice. I have decided to go and get a majority of the stock and leave a portion for her to work with. If she pays in time over the coming months then I can restock her slowly but no more large outlays of stock. Thanks again.

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A female reader, anonymous, writes (30 January 2014):

I am always "jealous" when someone goes on a trip, because I love to travel, it doesn't mean I wish these people bad. I am happy for them, but wish I could go too.

I have to disagree with answers here about treating this as any other business arrangements. I will explain why. She is not just any business partners she is a long time friend. Her being pregnant is a factor. She might not feel good, she migh have morning sicknesses, fatigues and so on.

Yes, if she was just another person who you do business with, then yes, treat her like any other person, but she is not JUST another person, she is a friend.

Yes, business is business, but we do give a slack to friends.

Her being all over sudden sloppy I relate to pregnancy. You had business relationship before and as you said she was on time and responsible.

I don't think she maliciously ignored you only because she was jealous of your travels, that just makes no sense.

With that said, if she put a significant strain on your financial situation then do what you have to do. Of course you need to protect your interests, and if your business is suffering significantly because of her sloppiness that take the inventory, explaining to her that you have no choice.

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A female reader, Honeypie United States +, writes (30 January 2014):

Honeypie agony auntI agree, treat her like you would any other client. She isn't paying on time, she isn't MOVING your stock. Maybe she needs to find another supplier?

Could be she is more concerned with the pregnancy then selling stuff.

Unfortunately, doing business with friends can be a bad choice.

I would not continue to do consignment with her, it's obviously not working out like you had hoped.

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A female reader, CindyCares Italy +, writes (30 January 2014):

CindyCares agony aunt Business is business. Do exactly what you'd do with other business clients. What's your policy, to allow some fexibility to customers who may go through a commercial slump ?. Then do it and sit tight for your usual "grace period " before claiming back your merchandise.

If instead your policy does not allow much flexibility, don't be a wuss. Claim your ten missing items - or their equivalent price IMMEDIATELY. And if you DO need your stock back, go get it, regardless of how pregnant she is. Her family life ( of which anyway you haven't even been informed, officially ) is not your concern. Being friends - or being pregnant- is not a free pass to screw up people or to apply unscrupolous business techniques.

If course ,as a friend, she may expect a little bit of a special treatment- and she did get it, when you let her pay one week later rather than right away as your previous agreements. But if she is leaving a BUSINESS commmunication unreplied for 3.5 weeks ( when she knows she owes for the 10 pieces ) - that 's sloppy both as a business person and as a friend, and IMO makes her forfiet any special tolerance under both regards.

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A female reader, YouWish United States +, writes (30 January 2014):

YouWish agony auntTake emotion out of your business dealings. She may be your friend, but you have a livelihood here. Not conducting business on a professional level takes food from your family's mouth. And you don't do business with people who delay or miss payments and don't communicate.

What agreements do you have in writing about when she pays you? In this woman's case, you don't send stock UNTIL she pays you for it. Running your own business means you don't front people for anything UNLESS there's an established professional practice AND it's in writing. Otherwise, if there's the least sign of wavering on the payment, the arrangement is over.

You need to focus on the clients who pay you and "fire" this one. Get your stock back and get payment for the stock she's sold and hasn't paid you yet. Then "fire" her. If you're worried about the friendship, tell her that in order to save the friendship, you can't do any more business with her under these conditions.

If she continues to owe you, then you talk to your lawyer, review any agreements in writing, and sue for reparations. It's cold and harsh, but if you own a business, you need to protect it. I have had to use the legal system in the course of my business, and there is one thing I have learned - and that's that clients tend to make it a much higher priority to pay you when their feet are held to the fire. The whole "I can't pay" most times means "I value my debt to you as much lower than I value other things". You can't be that way. You can't consider that she's pregnant, or things in her life, or the state of her business. You have to protect YOUR business, because all it takes is for a deal to go sour to send you into poverty.

Every debt collecting communication with her needs to be in writing, and everything must be saved now.

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A female reader, cupid lover Australia +, writes (30 January 2014):

cupid lover is verified as being by the original poster of the question

Chi girl you obviously didn't read my post very well.She told me that she needed loads of stock and now she doesn't reply to any messages. I am treating it like any other stockist. If another of my stockists didn't reply for weeks on end I would consider it extremely rude and unprofessional.

Also, she told me 3 times that she was jealous so that's a fact. I don't want her to be jealous!!!

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A female reader, chigirl Norway +, writes (30 January 2014):

chigirl agony auntYeah, stop thinking this is all about you. Shes probably so conserned about herself now that you just arent the priority in her life that you used to be. Deal with her business as you deal with all other businesses. This is how you should have done it from the beginning. Treat her business no different, not better, but not worse either. Is the demand for stock that great? Well then it was a poor decision made by you yourself, to send your friend that much. Dont punish her for your bad judgement. Shes not jealous of your trip, shes got her mind on something other than you and her shop.

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