Many of the retailers in this industry have an in-house charge account system. So do most of the chains you compete with. With many of the chains, their card is only a front for them as the card is issued by a bank or finance company. When a customer is using their card, the transaction is handled in the same fashion as would be a bank card such as Visa or American Express.

Many independent retailers handle in-house charge accounts on a more personal basis. To begin with, since independent retailers are making the decisions as to which customers will receive credit and to what amount, an application can be as simple as you want or need.

One impressive maneuver that we observed from a retailer in Miami was to pre-approve charge account applications for businesses and individuals that she felt comfortable with. In her store, supervisors and cashiers were authorized to hand out applications at their discretion. She found that certain professional people would gladly open a house charge account if they did not have to write pages of personal information.

One example she gave was from one of her cashiers who had joined her team after having closed a competing store that she and her husband had owned for years. When she recognized one of her former charge customers, she would initial the application and ask them to complete "only the basic lines" of information such as address, phone number and authorized signatures.

She would have a charge account open for the customer within 24 hours and follow it with two letters. The first was a handwritten letter from the owner thanking the customer for opening the account. The second letter was typed and was from her office supervisor. The letter explained the credit terms, and invited the customer to call if they had any questions or if they had lost an invoice.

All of the employees were also advised to watch for customers that were wearing shirts that identify potential customers - churches, parochial schools, church affiliated hospitals and nursing homes - and to hand them an application inviting to have their company open an account with the store.

There is an old theory that causes businesses such as hers to chase after these customers. The first half deals with the individual that had an account with a business such as yours. When the customer needed to make a purchase, they would not have to check their wallet or purse to see if they had enough cash to make a purchase. They could even send a spouse or child to make a purchase if they were in a hurry or busy. No one was going to ask for identification, or check the back of the card to see if the signature was the same.

This customer would not have the same type of experience if they had a charge card with one of your competitors. Of course, being able to be this "loose" with your charge accounts can come only after years of making friends with your customers, and with the office manager doing an excellent job of keeping on top of any accounts that became delinquent.

With commercial charge customers, you may find that there is very little price shopping by the individual that visits your store. The issue of price may have to be dealt with by conversing with either a supervisor, or perhaps an individual working in the church office.

If they needed alter candles, they were generally not concerned if the price is 79 cents each or $1.09. Their needs are better met by having product availability, quantity on hand, and a willingness to special order items.

With your charge accounts, you may want to include a newsletter each month with their statement. One shop owner we offer as an example sent her statements on the 26th of each month, enclosing a newsletter featuring a calendar which announced the upcoming specials for the following month. Frequently, there was an article which would highlight one of his commercial customers and the services that they provided to the community.

He always had an article in her newsletter which highlighted one of his team members, telling of their hobbies and family.

The most popular part of his newsletter was the coupon corner. Each month the newsletter offered a free product to charge customers. The item was always an item he knew was not available at the chain store.

His intent behind this was to have the customer try the product, and if they liked it, he anticipated they would return to the only store where the product was available. He found that approximately one in four coupons from the newsletter were redeemed each month.

Our retailer friend had created their mailing list with the information found on the drivers license. And of course, the newsletter would include an invitation to customers to request a charge account with her store. She stated they were very pleased that this total package program helped in keeping customers coming back to her store, and out of the competitor's stores.

Of course, you do need to be confident you have sufficient cash flow to allow you to expand your charge accounts. Having charge accounts requires additional funds, and constant monitoring to keep accounts current.

When you decide to expand this area of your business, be prepared to enjoy the increase in sales, the fun of knowing more of your customers by name, and the advantage your competition can't match.