Most transactions go poorly. Or, at the very least, they don’t go as planned. In fact, most small business transactions fail because there’s simply too much pressure to make them succeed. There’s also just too much competition for the smaller businesses that compete. It’s easy to get discouraged and give up on a project if it doesn’t come together. But that’s where having a plan can help you keep going in the face of uncertainty. A detailed understanding of what errors are and how to avoid them from occurring can go a long way toward keeping your small business alive and running smoothly for years to come. Keep reading for more information about what errors you need to look out for when selling your company or product, and how to avoid them in the most efficient way possible.
What Is a Small Business transaction Error?
Basically, a small business transaction error is when a customer orders a product and not all the items that go along with that order are properly charged or received. When you Overpayment for services or Bad Credit for the buyer, for example, you don’t have to be the main source of funding for the seller to lose their business. A credit card company can still portfolio your business debt, but that doesn’t mean that customers will continue to finance their purchases with that company. The same can go for a service that’s provided to a business but that the customer never requests or requires to be performed. For example, a mail-order bride needs to pick up her husband at his home in order for her correspondence to be logged into the dating service. But the bride owns her own business and her partner doesn’t want her to do it. So, the bride owns the business. A small business transaction error could also happen when you don’t disclose material information to the buyer. This could be the difference between ending up with a successful transaction or skipping to the Yes/No questions. If a customer questions whether or not they’ve been charged for a service, you probably don’t have to provide them with an invoice. If you’re not upfront and clear with prospective customers about what services are required or what isn’t, you could end up with a customer who isn’t interested in your products or services in the first place.
Overpayment for services
Some of the most common transactions you’ll see are when clients pay you for services that you’re not actually paid for. This could include being paid in cash, as when you sell a house for free, or receiving a tip from a friend in exchange for helping them out. Other examples include paying for services that you never received in cash, or for which you have no record.
Bad credit or debt for the buyer
Another frequent small business transaction error is bad credit or debt for the buyer. When a potential customer places a order with a lender and then discovers that the loan amount is higher than what they’re actually owed, they can charge the lender interest. This can delay the payment of the order, or even cause the lender to foreclose on the property. This tells potential customers that you’re out of control and that they can expect to pay more in legal fees and fine if they don’t take their order quickly.
Failing to disclose material information
Another frequent small business transaction error is not disclosing information about what services are required, who is required, or who is performing the services. This could include not listing services that you’re private label, or require that clients list their preferred vendors in their contract. Both of these are Federal Trade Commission (FTC) regulations, so you’ll have to keep your nose out of the dark if you want to keep running a successful business.
Company policy area not being clear
Another frequent small business transaction error is not clearly outlining what services are provided or how they’re obtained. For example, you have a mechanical engineer working on your project, but the company policy states that they’re not to be used on a residential project. You also have to list who you’re working with, what kind of work they’re expected to perform, and how the work is to be completed.
Defective item or service not being provided
Another frequent small business transaction error is a defective item or service not being provided. For example, you have a roofer who comes out once a month to redo your roof but who’s only approved for one job. But the contractor you hired said that he could never guarantee that the work would be completed on time. You should be able to list all of the services that the contractor should be able to provide, and you should have a valid contractor relationship with the person who designed the roofer. But you probably don’t. Even the most detailed description of a service or a project won’t be able to explain what happened when you shouldn’t have happened.
Bottom line
Unfortunately, small business transaction errors are a fact of life, and they’re something you have to keep in mind while running a small business. Don’t stress about them. Get back to basics and focus on running your business with as few errors as possible.