Politics | Campaigns | Business | Finance
Political Campaigns as Customers: Big Opportunity, Big Risk
Business owners: Be cautious about extending credit to political campaigns
Political campaigns around the country spend billions of dollars buying the goods and services necessary (and maybe goods and services that aren’t necessary but they buy anyway) to get their candidates elected.
We hear daily how much the candidates are raising and spending — and it’s not just on advertising. Campaigns buy other promotional items, food, transportation, computers, communication equipment, office equipment and supplies, audio-visual equipment and services, consulting services and more.
If you can get your share of that money, great!
Just remember: Not every company that has political campaigns for customers gets paid.
Consider the presidential race. Usually when a primary candidate drops out of the race, the campaign is out of money — not a good thing for the campaign’s creditors. After all, fundraising for a candidate that’s no longer running is not easy. It’s not unusual for former presidential candidates to collectively owe millions they don’t have the cash to pay.
It’s not just presidential politics that are so expensive. Every race — local, state and national — costs money to run.
Even though the amount is a relatively small portion of a campaign’s total budget, when a political campaign leaves a small business owner holding a bad debt, the economic damage to the business can be significant. And the money can be virtually impossible to collect.
What’s the answer?
The safest strategy is to insist that political campaigns pay in advance. Only extend credit to a campaign if you support the candidate or the issue enough to be willing to risk the amount of the sale as an involuntary in-kind donation.
Could this approach cost you business? Sure.
And there could be a negative ripple effect based on the personal networking that is part of politics at every level.
But it could also prevent losses — and only you can decide how much of a financial hit your company can afford to take.
A version of this article was originally published on my site at https://createteachinspire.com/political-campaigns-as-customers-big-market-big-risk. You can reach me there or email me at [email protected]
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