Know your customer, know your supplier

masked man in Venice

devil in disguise

We have all been there. Whether bootstrapping our way through start-up, or trying to keep a tight rein on our budget, there comes a time when we simply have to get the job done by someone else.

In my case, earlier this year, I needed to source a print supplier to print and distribute a set of promotional magazines.

I eventually found one who quoted a fantastically, competitive price. I should have known better. If something seems too good to be true, it usually is too good to be true.

I never got the magazines and according to the Debt Collector that I later employed, I am unlikely to get my money back as the company has since wound up.

I am furious with the Insolvency Practitioners who know perfectly well what these coy-boys are up to, who routinely start-up and wind down again. (Any Insolvency Practitioners out there? I dare you to prove me wrong. Leave a comment on this post).

But I am more furious with myself for making the classic mistake of going for cheap. In this particular case, “cheap” cost me hundreds of pounds and a good deal of stress and anxiety.

I remember as an Investment Bank employee (many moons ago), being sent on numerous Anti-Money Laundering courses. “Know Your Customer” we were told.

We had “KYC” Forms all over the place, not to mention umpteen weekly KYC Emails.

If a customer had an unusually large sum of money to invest, was there a plausible trail? Was the amount consistent with their usual investing habits? What was their line of products? What services did they provide? Did anything seem a bit dodgy?

I have to admit that at the time, I didn’t take any of it at all seriously. This was, after all, an Investment Bank trading billions of dollars every day. Really, who gave a damn!

But of course, when it comes to fraud, we should ALL give a damn. And now that I have a small business of my own, it is a particularly painful lesson to learn.  If only I paid more attention in class.

Here are my own “Know Your Customer/Know Your Supplier” tips:



If you are providing a service, protect yourself before work commences.  It is strongly advisable to draw up a contract between you and your client before any work commences.  Additionally, it would not be unreasonable to expect part-payment up front – particularly with a new client.



Nowadays, it is a highly competitive and crowded market for freelancers, contractors and micro-businesses. A project comes your way and you want to snap it up. Fast!

Understandably, as a service provider, you may not want to turn away business. But can you afford the adverse effects on your cash flow, if you end up with a customer who cannot or will not pay up when the job is done?

The following online company checks are, in my own personal experience, easy to use for a reasonable fee:

Company Check  : Type the company name in the search box and you will get a snapshot for free. You will need to pay for a credit check, CCJs, and current directorship. It costs £4.99 for a company report and £8.99 for a full director report.

Before you buy the director report, however, click on the director’s name and you will be taken to Company Check’s sister company, Director Check and this will give you a very useful snapshot of the director for free.  If there is a long list of “DISSOLVED” in the Company Status, this should surely ring warning bells!

Experian also has an online business checker, which costs £13.99 for a non-Limited company or £17.99 for a Limited Company. Full details here:



Not strictly a “know your customer” tip, but an important means of ensuring you stay on top of payments.  Ensure your terms and conditions are in your Service Agreement and stick with those terms when invoicing.  If you are servicing larger companies, it is particularly important that you get to know their payment procedures beforehand, as in some cases, larger companies will take longer to pay due to sign off/purchase order procedures.



Make good use of your professional network, online members clubs, forums, Linkedin profiles and ask for recommendations. Even asking on Twitter and Facebook can be really helpful. Post a quick “can anyone recommend a…?” and you’ll find people are incredibly helpful.



I can think of a number of appropriate expressions for this one.  “Pay peanuts, get moneys.” springs to mind.

You get what you pay for. “Cheap” is rarely worth it.





I’m Mary Cummings, a ghostwriter, collaborator and all round word doctor. I help business owners write and publish business books; I'm also passionate about helping creative freelancers find work that they love - their work sweet spot with work on their terms, projects they love and clients who are a dream to work for.

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