Behind every successful entrepreneur there are A LOT of failures, especially in the world of factoring. Being defrauded is a part of the factoring industry and it’s only a matter of time until it happens to you on some level. However, there’s a difference between coming out on top and going under. Here are some ideas on how to deal with being deceived and what to do when you find yourself asking, “What now?”
(This article is a follow up to Protecting Yourself From Liars in the Factoring Industry – Part 1)
Add it to your business plan
We know—this sounds a little crazy. But calculating losses into your expenses before they even happen is a smart idea. Think of this as your ‘rainy-day’ fund: just like you wouldn’t go into retirement without any sort of savings, doing business paycheck-to-paycheck or spending exorbitantly when times are good isn’t smart either. You might still be surprised when it happens, but having a solid reservoir to tap into and offset some of the loss might help soften the blow to your factoring business.
Assess the damage and re-group
Okay, you’ve discovered the problem and stopped the hemorrhaging—now it’s time to come up with an action-plan on next-steps. Can you work things out with your client once you’ve exposed them? If not, or if they’ve gone completely silent, what resources can you leverage to try and get at least some of the money you’re owed? Do any third-parties (lawyers, private investigators etc.) need to get involved? When it feels like your factoring business is spinning off its axis, it’s difficult to remember that you are in complete control of your actions and re-actions. Do what you can, with what you have, and ask yourself what you’re capable of fixing until you get more information.
Maintain a sense of gratitude and purpose
This seems laughable when you’re at rock bottom, but gratitude and purpose are two of the largest components of happiness and resiliency. Being able to recognize the things you DO have or are good at can help you rebound faster. Viktor Frankl, an Austrian psychiatrist and Holocaust survivor that developed “meaning therapy,” wrote in his book, Man’s Search for Meaning, “We must never forget that we may also find meaning in life even when confronted with a hopeless situation, when facing a fate that cannot be changed.”
Take care of yourself
It may seem like common sense, but taking proper care of yourself when dealing with setbacks is essential to overcoming them. Continuing to eat well, get rest and exercise, even when it seems like you may not have the time or that work should take priority, is of utmost importance. Exercise acts as a natural anti-depressant and is proven to lower levels of cortisol, a stress-hormone. By continuing to engage in healthy activities, you’re setting yourself up physically and mentally to attack problems with energy and a fresh mindset. We aren’t robots: we need rest to re-boot and not taking the time to do so can lead to more health problems.
Get support
Although it may not have been publically broadcast, you are hardly the first person within the invoice factoring industry be defrauded or experience a loss. While it is hard to admit failure, it has the ability to open new doors and build relationships with colleagues that have been through it. Chances are they will have helpful feedback, advice or tips on how to move forward or resolve a particular situation.
Move on
You have a right to be angry but at the same time, failing and losses are just the cost of doing any business. Use the situation as a learning opportunity to do better next time, because yes—there will likely be a next time. Dwelling on what happened isn’t going to help you grow or succeed and absolutely won’t help get you back on your feet. Accept what happened and “fail forward” so that you can create the most desirable outcome out of a bad situation.
Hardly anyone gets it right the first time. Or even the second or third time. True, being deceived or stolen from isn’t necessarily a business mistake, but when you’re dealing with people who need money, it’s destined to happen. Collapsing, both personally or professionally doesn’t have to be an option, if you can take advantage of the tools available to help you conquer even the worst of factoring deals-gone-awry.
About the Author: Factor Finders specializes in finding factoring companies that can fund difficult-to-place deals. Our services help other factoring brokers capitalize on commissions that might otherwise be lost.
If you have a prospective transaction that you cannot find a funder then contact us at FactorFinders.com. We’ll find the factor for you and split commissions 50-50.