blog

Keep an Eye On Your Money

 

 

 

 

By Ben Henkels, Principal, Communication Management Partners

To some of us, it seems all we need is yet another thing to keep track of these days. We are doing more with fewer resources; we have more time into securing sales, but at least we have our residual commissions coming in.

Wait … where are these coming from? You need to keep an eye on the news and the financial networks to ensure your residual commission provider is not on the bankruptcy steps because that could drastically impact your cash flow.

Several years ago this happened to someone I know well. First the carrier went in to Chapter 11 and during the proceedings that turned into Chapter 7.

The Chapter 7 took 25 percent of his monthly income and wiped it out without recourse. The network and customer assets of the provider were sold to another carrier, but it still left the agent without that residual.

Another example is the hosted VoIP provider in New York that recently shut down with very little to no warning even to the customers they served.

Make sure the residual base you receive is on solid ground while you navigate through this economy.

Does your contract have performance clauses the carrier can enforce to cut its expenses? Almost all of us that have been in the business for several years know someone that got caught in that. Then you hear things like, “They never enforced it in the past.” Well, the past looked different. Economic pressures change the operating parameters for most companies, so do not count on business as usual.

Also take another look at your agreements and the language they use when it comes to assigning ability. In the near future, it is very likely that we will see several mergers and acquisitions as companies assess their balance sheets and future prospects.

Be aware that publicly traded companies have reporting and disclosure requirements and, at the same time, get a little more familiar with your current partners. It may save you a surprise or two.

Ben Henkels is the principal and founder of Communication Management Partners, a telecom brokerage and consulting business. Henkels also is a member of the 2008-’09 PHONE+/Channel Partners Conference & Expo Advisory Board.


Leave a comment

Your email address will not be published. Required fields are marked *

The ID is: 91240