Dealing with Bounced Checks: Tips for Managing Money in Your Home-Based Business

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Discussion Overview

This thread discusses experiences and strategies related to managing bounced checks in a home-based business, particularly among Pampered Chef consultants. Participants share personal anecdotes about dealing with bounced checks, payment methods, and the implications of these financial issues on their business practices.

Discussion Character

  • Anecdotal
  • Opinion-based
  • Debate/contested

Main Points Raised

  • One participant, identifying as a consultant, has dealt with bounced checks twice in five years and expresses frustration over the timing of deposits and notifications.
  • Another participant shares that they do not have guests make checks out to the host, preferring to take checks to the bank the day after the show, and notes a decrease in bounced checks due to increased debit card usage.
  • One consultant mentions that they encourage credit card payments and have had minimal issues with bounced checks, stating that most guests have made good on their payments.
  • Several participants suggest offering incentives for using credit/debit cards to reduce reliance on checks.
  • One participant recounts a situation where they cashed checks at the bank of the issuer, noting that this approach can help avoid insufficient funds issues.
  • Another participant shares their experience of having bounced checks from relatives, leading them to verify funds before cashing checks.
  • One participant discusses a situation involving a declined credit card payment and expresses uncertainty about the ethics of re-running the card without prior notice to the customer.
  • Another participant raises concerns about the ethics of running a customer's card for a previous bad payment without warning.

Areas of Agreement / Disagreement

Views differ on the best practices for handling checks and credit card payments, with some participants advocating for cashing checks at the issuer's bank while others prefer to avoid making hosts look like a hassle. There is no clear consensus on the ethics surrounding re-running credit cards for previous debts.

Contextual Notes

Participants share a range of experiences, indicating that the handling of bounced checks can vary widely based on personal practices and local banking options.

Who May Find This Useful

This discussion may be useful for Pampered Chef consultants looking for insights into managing financial transactions and dealing with payment issues in their home-based businesses.

dannyzmom
dannyzmom
Gold Member
Messages
9,271
I have had to deal with bounced checks twice in my almost-5-years in this business.

Both times it ticked me off something fierce...

So...let's talk money.
Home office encourages us to close shows within 3-4 days, right? Well, if I have a Friday night show, the checks get deposited on Monday. If there are NSF on any of those checks, I will not know until the FOLLOWING Friday. So, am I supposed to float $ for these people whom I don't even know??

There is buzz about having the guests make checks out to the host and getting one check from the host...I agree with Beth on this one. I don't want my whole show bouncing.

What are everyone's thoughts on how to handle this issue?
 
I don't have guests make checks out to the host. That makes hosting look like a hassle, and I don't want to do that. I do take checks to my bank the day after the show (my bank is open 7 days a week). And as much as I recommend it, I almost never end up closing shows in only 4 days, because the hosts always seem to have "one more order" coming in. But I've had fewer checks in the past year or so than when I first started, just because debit cards pull from the same account and are easier.If you would like to encourage card use, maybe you could offer $1 off orders that are paid with credit/debit cards. Then you don't have to worry about checks.
 
I have the checks written out to me. I encourage credit card/debit card payments. I pay for the show with my PC Credit Card. I always know that all the checks cleared before I have to pay the CC bill and I pay it in full and get bonus $$ for using it. No worries about going under in my checking account.

I have had about 6 checks bounce in 6 years. One of the orders was shipped to me and the guest (a past host - twice!) never returned my calls or emails. She just disappeared. I held onto that product way too long and missed the chance to send it back at no cost and ended up selling it at a loss.

ALL of the others immediately made good with me and paid (OFFERED TO PAY) the fees my bank charged.

I approach them with the attitude that there's probably an error with the number or something. Never accusing. And to a person they knew the check wouldn't clear when they wrote it. DUH. I still treated them well and when those that bounced checks had their own show or ordered again I privately kidded with them about it being good. And it always is.

Addendum: I try to close shows in 2-3 days but do allow hosts to take a little longer if they NEED it. I submit the show as soon as the checks are in my hands (but not necessarily in the bank).
 
  • Thread starter
  • #4
chefann said:
If you would like to encourage card use, maybe you could offer $1 off orders that are paid with credit/debit cards. Then you don't have to worry about checks.
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Nah - I am just going to b*tch and moan for a few weeks since this latest bounced-check fiasco and then I'll gte over it again - LOL
I just need to piss and moan for a while...
 
That incentive could be a good idea Ann, to get more to use their cards.
I have them make checks out to me too; I tell people I like to keep it easy for the hosts. Knock on wood, I've only had 2 checks come back in 6 1/2 years. (1 that I'm still awaiting payment on:grumpy:)
 
dannyzmom said:
Nah - I am just going to b*tch and moan for a few weeks since this latest bounced-check fiasco and then I'll gte over it again - LOL
I just need to piss and moan for a while...
Click to expand...

This made me laugh!:p
 
Would it be possible to go to their banks & cash the checks? Our town has tons of banks & branches all over so much that I could just about drive down one street & hit a branch for each bank.
 
kaseydee said:
Would it be possible to go to their banks & cash the checks? Our town has tons of banks & branches all over so much that I could just about drive down one street & hit a branch for each bank.
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I have done that. Especially when they say "cash it right away" or "wait until Friday". Some banks charge you to cash a check if you don't have an account but many don't.
 
kaseydee said:
Would it be possible to go to their banks & cash the checks? Our town has tons of banks & branches all over so much that I could just about drive down one street & hit a branch for each bank.
Click to expand...

I know a Longaberger lady around here who does that. She tried to cash a $300 check from a fellow preschool mom on a Sunday, and the account had insufficient funds b/c the mom didn't think she'd deposit it until Monday, when she had planned to move the money from one account to another. I trust what this woman said, too, b/c I know for a fact she had LOADS of moola, so she wasn't hurting for money - she just needed a little time to get it into the account that she wrote the check from (she was spending LOTS of money at the school fundraiser, so she must have had to dip into another account, I guess). Anyway, I would just let them know that you're planning to cash the check at their bank branch on X day if you're going to do this, just to give them this courtesy (and avoid insufficient fund issues like that!). ;)
 
  • Thread starter
  • #10
Sometimes it is feasible for me to go to their bank branches but oftentimes it is no -- like this most recent case...she banks at a credit union - I have no clue where their branches are...most likely in Miami where this show was (an hour away)
 
I have been fairly lucky in the check dept. Only had 2 in 5 years. 1 was bank error & the other was because she lost checkbook & stopped all payments. Both were paid immediately.
 
I have them make checks payable to me and go to the bank the next day. Most pay with cash or credit/debit. The ones who have paid by check I know well, so I have not had any issues yet... knocking on wood!!!
 
I have had two RELATIVES bounce checks on me.If my own family would do this, why not a stranger? With this in mind ... I take every check to the bank on which it was drawn and cash the check (if they will do so without charging a fee) or verify funds, and immediately deposit them.I have never had a problem after I started doing this. It is a bit time consuming, but one time it paid off with a $500 show!
 
I am soo lucky, most of my customers pay by check and I have never had one bounce. I have had a CC decline though.
 
So....I had a credit card decline back in September. It was a $50 order...the order was shipped right to the guest and she kept promising to send me cheques, but never did...so I just ran her card again on a recent show...do you think that's bad??! I was told to do it by an upper-level Director, so...I did it. The show hasn't been processed yet so I don't know if it worked or not.
 
I don't know if the laws are different up north, but I would think that would be paramount to theft. Nevermind the fact that I think it is unspeakably unethical.
 
What's unethical?
 
katie0128 said:
I don't know if the laws are different up north, but I would think that would be paramount to theft. Nevermind the fact that I think it is unspeakably unethical.
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Wait...what I did was theft or what she did was theft? She took $50 in product and never paid me...eta: I forgot to mention that I've been calling this woman for months and she tells me every time that she forgot to send the cheque and it's in the mail, etc...
 
katie0128 said:
I don't know if the laws are different up north, but I would think that would be paramount to theft. Nevermind the fact that I think it is unspeakably unethical.
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chefsteph07 said:
What's unethical?
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There was a post, although it seems to have been removed, about someone having a customer's card run later to cover a previous bad payment. With no warning to the customer that it was being run for that old debt.
 
chefann said:
There was a post, although it seems to have been removed, about someone having a customer's card run later to cover a previous bad payment. With no warning to the customer that it was being run for that old debt.
Click to expand...

Sorry...I deleted my post until I can write it out properly. I wrote it quickly and it was clearly...not clear.
 
Ok here's the situation:I had a show back in September. I was given an outside order from the host - someone from work, I believe. She provided a credit card number for the order (approximately $50 before tax, shipping, etc...). The credit card was declined. I called the customer and she said it was no problem - she'd send a cheque in the mail the next day. Rather than hold up the entire order, I asked HO to release it and charge me. The cheque never came. The lady got her stuff. I called her a number of times, sometimes reaching her, sometimes not. When I did reach her, she apologized and said she forgot to send the cheque, and it would be in the mail the next day. I never received anything, called her a few times, never heard back...called the host, who said she had no other contact info for this lady and she doesn't really know her that well. I was going to send a letter with a self-addressed stamped envelope but I didn't have her mailing address - just the one you can find on 411 but since she's out in the country, that's not her mailing address - you need a PO Box. I was talking to an Upper Level (not mine) and she told me to try her card again. I didn't think much of it because, well...this lady owes me $50. I tried calling her a few more times, thinking I could just leave a message saying I was going to charge her...but no answer and no machine. The show hasn't been submitted yet and I'm starting to doubt that I should run it...however I feel like I'm owed this $50. It's not like I forgot to charge her or stopped calling her or anything...I just want to be paid. This $50 order barely covers the commission I made on that whole show!Wouldn't it be the customer that's stealing?? I mean, she got her products and never paid for them!
 
That's true, that she never paid for the products which is essentially stealing. But you should warn her that you're going to run the card again, even if it's just a message on her phone.
 
chefann said:
That's true, that she never paid for the products which is essentially stealing. But you should warn her that you're going to run the card again, even if it's just a message on her phone.
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See, but I've tried to call a number of times and there's no voicemail. I can't mail her a letter and I don't have her email address. :cry:This is why I now tell all my hosts I can't process orders without an address.
 
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Ooh - that's tricky. The fact that you can't contact her changes the whole dynamic.
 
chefann said:
Ooh - that's tricky. The fact that you can't contact her changes the whole dynamic.
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Yeah...I really wasn't clear the first time. That's what I get for typing and trying to pack at the same time.
 
I may get slammed for this, but I think you did the right thing, and I'd prob do it too!

What's unethical is a customer receiving a product that she knew she didn't pay for and think she could run away with it without being caught. The consultant had her credit card number, I think that the customer should have EXPECTED her to run the card until she got payment!

Isn't Carolyn going through kind of the same situation? Something about the customer having the funds next week but received the prods already? ...I said in one of my posts to keep running it till she gets it..I think any other "business" would do the same, and I dont think they are being unethical for doing so.
 
chefsteph07 said:
I may get slammed for this, but I think you did the right thing, and I'd prob do it too!

What's unethical is a customer receiving a product that she knew she didn't pay for and think she could run away with it without being caught. The consultant had her credit card number, I think that the customer should have EXPECTED her to run the card until she got payment!

Isn't Carolyn going through kind of the same situation? Something about the customer having the funds next week but received the prods already? ...I said in one of my posts to keep running it till she gets it..I think any other "business" would do the same, and I dont think they are being unethical for doing so.
Click to expand...

See this is why I'm torn. It is a business. You can't just go around stores and take products without paying for them. It would be "essentially" stealing. It would be stealing.

However, I know I'd be upset if my card had a charge show up all of a sudden. But then I would never take products without paying for them.

I know it probably varies, but do you know if there is some kind of rule as to how long after purchase can your card be charged??? Should I maybe call the card company directly and ask?
 
OT - Winnipegk - how do you NOT have email??? :)
 
stefani2 said:
OT - Winnipegk - how do you NOT have email??? :)
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I have email - she doesn't have email. :) (edited my post)
 
Winnipegk said:
See this is why I'm torn. It is a business. You can't just go around stores and take products without paying for them. It would be "essentially" stealing. It would be stealing.

However, I know I'd be upset if my card had a charge show up all of a sudden. But then I would never take products without paying for them.

I know it probably varies, but do you know if there is some kind of rule as to how long after purchase can your card be charged??? Should I maybe call the card company directly and ask?
Click to expand...

So what if she's upset?
Would you expect anything less if YOU did the same thing as this customer?
I'd probably say to myself that I had it coming since I knew I didn't pay for it. If you don't have her info, any of it, then let HER contact YOU if she wants to dispute or argue about anything. I seriously would NOT lose sleep over this, she finally paid for it and now you can be done w/ the whole thing.
Why did she give you her card number if she didn't expect to be charged?
 

Frequently Asked Questions

What should I do if I receive a bounced check from a customer?

If you receive a bounced check, first contact the customer to inform them of the issue. Politely ask if they are aware of the situation and request an alternative payment method, such as cash or a money order. It's important to maintain a professional tone to preserve the relationship.

How can I prevent bounced checks in my home-based business?

To prevent bounced checks, consider implementing a few strategies: require payment upfront for orders, accept only certified checks, or use electronic payment methods that provide immediate confirmation of funds. Additionally, you can establish a policy for handling checks, including a verification process for larger amounts.

What are the legal implications of accepting bounced checks?

Accepting a bounced check can have legal implications, including potential fees and the need for collection efforts. Depending on your location, you may be able to charge a fee for the bounced check, but it's important to check local laws regarding this practice. If the issue persists, you may need to consider legal action or involving a collections agency.

How should I handle repeat customers who have bounced checks?

For repeat customers who have bounced checks, it's essential to approach the situation delicately. You may want to have a conversation with them about their payment history and express your concerns. Consider requiring payment in advance for future orders or offering alternative payment options to avoid further issues.

What steps can I take to manage my finances better to avoid issues with bounced checks?

To manage your finances better, keep accurate records of all transactions and regularly monitor your accounts. Set aside a portion of your income to cover potential bounced checks and create a budget that accounts for fluctuations in cash flow. Additionally, consider using accounting software to help track payments and identify potential issues early on.

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