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Are you "Being Guido?"

Just got a call from a colleague on my team - and she completed a staging job on a vacant apartment that was modeled for the builder. She put the rental furniture in her name, and has all her other stuff in the house. Fee was about $2,000 for the Staging. Seller/Builder gave her a check. Guess what? Doingggg! The check bounced! So now what? The guy has not returned her calls and she called me for advice.

First - I call this situation "Being Guido." When we are Guido, we are bill collectors. And "Being Guido" is not fun at all. Guido takes our focus off of Staging which is our passion and love. Being Guido means you and I "hope" the clent is ethical and will pay, and pay on time. Collecting for ongoing rental in Guido mode is time consuming and frustrating. People get distracted, our invoices are not a priority, and we wait for payment instead of running our Staging companies like a business.

What I have advised ANY Stager I teach or work with is to get a MERCHANT account. This puts Guido away and puts us in charge of the process. With a merchant account, we can take debit or credit cards. Pay Pal is merely Guido via email - you and I are still not in control of the actual processing of the card. So even if the person says, "Oh I don't like using credit cards or I don't have a credit card" - they have a checking account which means they have a debit card. So, no more paper payment. Debit cards work just like credit cards. When it's a small amount and a 1-time fee, then I will take a check. When I work with Realtors, I know where they work, and have recourse to go after their office, or license if it got bad. But, when it's a seller or builder, good luck. They can hide, they can avoid. Your next move is a lien or small claims court. Those are costly if not in actual $$ in time and focus. That is why being in control with a Merchant Account gives peace of mind. If the money is not in the bank or on the credit account when you process the payment, you don't stage the house! And since the merchant account process takes up to 72 hours average to plop the $$ in your business account, we run the payment 1-2 days prior to our jobs, to make sure the funds are good. My clients have not had any issues with this process.

Anyone else have "Being Guido" stories? I hope that if you read this and do not have your business set up to accept credit cards, you get this set up. One bad experience where you are left holding the bag is all it takes to set us back financially. Don't be Guido. Check with your bank to see what their merchant options are. It's so easy to set up and gives us total peace of mind.

- Jennie

Posted by Jennie Norris, ASPM, IAHSP on 04/28/2007 08:58 PM

Comments (8)

advice, staging, staging to sell, training

8 Comments on Are you "Being Guido?"

APR

2007

Jennie,

About how much is the investment to set up a merchant account?

Thanks - Sherri

Hi Jennie,

I have been blessed to have honest people - I've never had a bounced check or never had someone say they would send me a check and not send it. I will say however, I do not schedule a staging, until the check is in my hands; I do not stage until I know the check has cleared. Having said that, I do see benefits of a merchant account because it only takes ONE bad experience to teach you that ONE is TOO many.

APR

2007

I have a merchant account and get money in advance, yadda yadda..... sometimes, rarely I do month to month rent (with more than 1/2 up front). When the 1st monthly payment was 10 days past due I called in the agent who had helped set up the job. He promptly went to the client and returned with a check for the balance of the job.... $1050. That check bounced, still uncashable. I'm going to file a contractors lien this week actually. The furniture was removed immediately. Unfortunately because this was primarily rental furniture, it actually did create a loss.

Now with that said. For the past year I've staged 1-3 vacant homes a week and this is the only time I've ever had this occur. Had I really thought this out before hand I probably would not take the job in the beginning. The new home site is a mess - the home is easily seen the worst design I've ever laid eyes on & there was no pride in getting the unit cleaned before I staged it. Even 45 days after I staged the unit the bathrooms were still pre-construction dirty (think no porta potty on site)...... this was my fault every bit as much as the builder and the agent.

I have found that all it takes is one bad apple and it is usually the seller or builder, not the Realtor that shafts you/me to make us want to make some changes. We can use our judgment and if we get the feeling that the client is not going to be a good one (like when his name is Sergio - true story - Sergio ended up shafting one of my team members - and I apologize if you know a good Sergio). . . I always got paid too when I took checks - but not always on time - and that became the problem. I don't want to be spending my time invoicing people and making collection calls to remind them they owe me $$. I want to be Staging. A merchant account solved all that headache - and put my focus on Staging which is fun, versus bill collecting, which is not. If taking checks, post them to the bank BEFORE showing up to Stage so you KNOW the money is good. Nothing like hiring help, getting a truck, taking time to load, etc. - only to find out that there is no money behind the job. - Jennie

MAY

2007

Jennie,

Do you know the various set up fees with a merchant account, and how we can find one that is competitively priced? Your input would be appreciated, thanks!

Hi Maureen,

Most banks offer merchant accounts - even Costco offers it. As an ASP you can go to www.SHCMerchant.com to find out more - and they have helpful customer service agents to help. The fees can be around $125.00 to set up a phone based approval system, plus a monthly fee of about $30.00, and per call fee of around 35 cents. There is a per transaction fee based on the type of credit card your client is using, and these fees can be wrapped into the bid proposal so that we don't lose $$, or just chalk it up to the cost of doing business, and realize if you were Guido, it would cost you way more in your time to track down payment. There are online accounts you can set up via a secure website terminal - about $140.00 to set up and $15/month to maintain. Again, minimal fees per use, and same credit card transaction fees. All merchant pay fees to the credit card companies. Banks may offer a lolwer, flat fee program - all you have to do is ask.

Also, key to note is that when we process merchant account payments, the $$ does not go right into our business checking accounts (you need a business account to make this work and to get a business account you need a valid business license). The $$ can take up to 72 hours average to deposit, so we process the card a day or 2 in advance of our jobs, and then Stage. That way, we are not fronting $$ for the Staging - and so far no client has had an issue with this once I explain the WHY of how things work.

- Jennie

I like the idea of taking the check in and having it clear before the staging is scheduled. I get paid at the time of the consult & as it isn't a large figure I could swallow it (& my pride) But when you are putting furniture in & lots of time - it is a different story. So far no problemo-Sergio, but....

Haven't had any problem with the Realtors yet & I do know where they live!!!!

MAY

2007

As the saying goes: Happens once "shame on you", happens twice "shame on me".

Always ask for a certain percentage down. Successful stagers deal in the thousands of dollars. 25% down is the best way to protect yourself.

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