Anyone else having Bounced Checks from these guys?

[cbl_chaz]

Was just curious if anyone else has experienced bouncing checks from SebastianPass.com. We just received a bounced check back from them for the video feeds they used 2 months ago and now they are giving us the runaround.

[gaybucks_chip]

I shouldn't be the one to say this, but.... why am I not surprised :)

[gaydemon]

I never dared to promote them to be honest after what I heard and read about them. True or not, its still was enough to keep me away.

[nickbaer]

Yup. I' refer you to the recent discussion on GWW... but...

[Seth]

Their webmaster program says they're using CCBill. Were they recently handling their own payments?

[marcjacob]

Their webmaster program says they're using CCBill. Were they recently handling their own payments?

The check was for video feeds.

[Seth]

The check was for video feeds.

Oops! I guess the original post did say that.

[gaydemon]

No.. its was way back actually. I dont visit other boards ;)


Yup. I' refer you to the recent discussion on GWW... but...

[cbl_chaz]

Well I am sad to announce that due to tight budgets and people like this that refuse to honor their debts, collegeboyslive.com will NOT be attending Internext in FL. The loss of expected income from this check, plus the fees that have resulted from it's rejection make the expense of attending the show an unwise investment. I don't know who is more disappointed, me or the boys. I guess we'll have to wait until January and see everyone in Vegas!

[nickbaer]

Just another example of the inherent risk of extending credit to anyone.

If you don't get the check in advance, you're increasing the probability that you are simply giving your product to the customer on a silver platter.

If a customer doesn't have a couple hundreds bucks to buy your product, he NEVER will.

In Poker, you have to ante. Same in business. You need to put your own ass on the line, not someone else's.

[gaybucks_chip]

If only it were so cut-and-dried.

We at one point had a distributor that owed us $140,000. The bill got that high because he was selling a lot of product into Europe and it took a while for him to get paid. If we hadn't extended the credit, he would never have taken that much product.

We eventually got paid, but it just took a while. We knew the person was good for the money, but we also knew, as we extended the credit, that it would probably take a while to get paid.

In business, sometimes you have to make a judgement call. It's easy to second-guess everyone else and say "never trust anyone under any circumstances and always get your cash up front" or "never take a cashiers check" or "insist on cash greenbacks and nothing else" or whatever, but when you do that, you often limit opportunities for growth.

It's certainly one way of doing business, but it's not the only way and may not be the right way for everyone. So it might be nice to not assume you have a monopoly on the correct means of doing business.

[nickbaer]

The issues are complex, so no need for the personal jab. Reminds me of GWW.

The unanswered questions:

1) What would have happened to your company if he had defaulted on the $140K debt? Was the $140K within a manageable percentage of your company's annual volume and annual operating income?

At what point would you have cut off his credit? (A hypothetical question for all studios to ask of anyone they extend credit to regarding the purchase - end user or distributor - of your product.)

2) What can a "distributor" do, that in reality you cannot do?

You sell to a distributor at a discount, vs you hire a couple of people to sell as he did?

What's the real difference? Besides keeping the revenue in house, and keeping your cards close to your chest?

[boydollarsbrian]

Just another example of the inherent risk of extending credit to anyone.

If you don't get the check in advance, you're increasing the probability that you are simply giving your product to the customer on a silver platter.

If a customer doesn't have a couple hundreds bucks to buy your product, he NEVER will.

In Poker, you have to ante. Same in business. You need to put your own ass on the line, not someone else's.

Very TRUE!!!! Maybe it is the economy or whatever, but we have been running into this kind of shit quite often lately from affiliate programs that we promote. Canceling your affiliate account and denying you your rebills seems to be a big one right now.

[gaybucks_chip]

It wasn't intended as a personal jab, I'm sorry if it came off that way. But yes, you're totally correct that the issues are complex, and that was the very point I was making.

In our particular case, the $140K was a manageable risk for us. I totally agree that extending credit to a point where non-payment will put your company under is extremely unwise. In this case, we knew that, worst case, the company had assets we could lien against to collect if we had to, and the payment pattern was such that we had reason to allow the credit limit to get that high.

Basically we had already set $150K as the upper end of what we were willing to extend, and we were constantly being paid each month in an amount exceeding what was adding on to the debt. So when we got close to the limit, we simply negotiated a payment plan that brought it down at the rate of $20K/month.

As far as what a distributor can do that we can't *theoretically* do... the answer is, honestly, "not a whole lot." The main issue is volume. Right now, we are not equipped to handle the volume of shipments that we would have to handle if we didn't have a distributor. The secondary issue is European distribution. Right now, we've made little to no efforts to market out product ourselves outside of the US, yet a significant portion of our sales through MP are to European customers. The third thing is... MP has a half dozen salespeople and a track record with stores, and so they are able to push a volume of product to retailers that we would have to either hire more people or work really hard to match.

A lot of people dislike distributors, and I can definitely see that for a studio that is selling a few hundred units a month or less, self-distribution probably makes a lot of sense.

None of the current distributors out there are perfect, but MP (and our previous distributor) have always treated us well. Yes, it's adding another layer in the loop between us and our reseller customers, but at this point, the positives outweigh the negatives. It's always possible that the situation will change -- we are constantly examining our business model in light of the changes in the industry -- but for the forseeable future, in our particular case, continuing to work through traditional distribution channels makes sense for us.

[cbl_chaz]

Just to clarify, in this particular case, the feed site subscribers DO pay ahead. This company had expressed their desire to cancel their feed link once the then current period had ended. We provided them with a two week grace period to give them time to gather their income from other sites. So the period was already half way through. Once the check arrived, our bank flagged it with an eleven day hold (putting us into the next billing cycel) and then returned the check unpayable. Below is the letter I received from them.

Chaz,

Don't come after me for a demand for payment after you knowingly falsified information on an internet webmaster forum where hundreds of people can read it. That is pure libel. Printouts of YOUR postings were overturned to my lawyers and they have said this is libel as well.
Now about the payment. The check was not returned for insufficient funds. It was returned because I put a stop payment on the check.
I am not making payment arrangements with you.

My attorney has also mailed a letter to you as well. You may want to keep a lookout for that.

I wish you the best.

Sincerely,
JJ

And my response to him, which I have yet to hear back from.......

This has to do with paying for services that you received. I took you out of the picture and contacted "Derek". Why am I hearing from you instead of him or your accountant? I wish to speak to one of them, not you. It is quite apparent that we cannot conduct business with each other. I simply want what is due to collegeboyslive.com and then you will never hear from me again. Please have one of them contact me or Zac immediately. I have not made mention of ANY of this on the boards or to anyone in private, nor do I plan to. This matter is simply between collegeboyslive.com and Sebastianpass.com...NOT Chaz and JJ. Let's get this matter handled so we can both move on in our separate directions.

[nickbaer]

Since there is no "Derek Tanner", JJ forgot which personality he was speaking as.

[pornteam]

This company still has an outstanding balance with us. We are in the process of sending them to collections as we speak.

[nickbaer]

I think you just did! :)

[cbl_chaz]

We have REAL attorneys on retainer that will handle this situation. I have better things to do with my time and our company's resources.

[gaydemon]

He certainly sounds like one of those people who add "sue" and "laywer" to every sentence but hasnt actually got any, let alone can pay for one.

I do hope you can recover what he owes you. Non payments seems to have become more and more frequent.

[cbl_chaz]

I am confident that a payment will be received. Our collections people are very resourceful. It's just sad when you have to resort to such measures, especially concerning a company that you bent over backwards for. Oh well, lesson learned.