In the News

September 17, 2020

 

Four Tips for Successful Interpersonal Communication

 

—Kit Welchlin, M.A., CSP

Interpersonal communication is the face-to-face interaction between two or three people over time. Through these interactions people establish and maintain trust, resolve conflict, and build effective personal and professional relationships. To do this successfully, we need to be credible, understand the power of perception, make our messages easy to understand, and demonstrate active listening skills.

Become a Credible Person: If we summarize research, we discover, that there are six criteria of personal credibility. 1. Appear warm and friendly. Are you always approachable? Are you consistently pleasant to be around? 2. Express your intentions and motives: What are your short-term plans and long-term goals? What are you up to for the next couple of hours, couple days, couple of weeks, or couple of years? 3. Demonstrate trustworthiness: Do the majority of people you associate with find you reliable? Are you consistently dependable? 4. Be an information source: Do you know knowable information, what is pinned, pasted, or posted on the walls or website? 5. Develop relevant expertise: In certain areas of what you do, do you know more about that than anybody else in the organization? 6. Project dynamism: Do you have natural enthusiasm for your work? Does it appear you actually enjoy your job?

If you model these six criteria of personal credibility, your ideas will be more easily accepted and your opinions more valued. Now that you know the list, try to recognize areas of weakness and get to work to be not only credible, but incredible.

Understand the Power of Perception: Whether you have worked with someone for years or meet someone for the very first time, there are actually six perceptions going on all at the same time. From my side of the relationship: Who I think I am. Who I believe you think I am. And really who you think I am. And from your side of the relationship: Who you think you are. Who you believe I think you are. And really who I think you are.

So, when you are a public figure, or when you are representing your organization in a public or private way, make sure you look the part. People are drawing conclusions about you quickly. It may take people as little as 100 milliseconds to form an impression of another person, to decide whether he or she is attractive, trustworthy, competent and likable. According to Princeton University, that’s less time than it takes to form a rational thought.

When you anticipate meeting someone for the first time, consider what you can do to ensure that the person perceives you as you actually are. Always be at your best behavior, there is always someone that will notice.

Make Your Messages Understandable: It’s great to have a large vocabulary, but it may alienate people if they don’t know what the words mean. I believe people would rather feel informed rather than ignorant. Heck, I grew up ignorant, so it doesn’t bother me when people use great big long words, however, it can bother others. I simply ask, “How do you spell that?” “What does that mean?” Most people aren’t as confident with their ignorance as I am and may feel awkward.

The key to effective communication is to make sure that the words you choose are both accurate and simple. Sometimes when people use a large vocabulary, they think they’re being more accurate, but they’re actually being distracting. Instead of saying morose, say pessimistic. Instead of saying copacetic, say acceptable. Instead of saying macabre, say eerie or spooky.

When you use simple words, people won’t wonder what you said, and they’ll fully understand what you meant. In your meetings, pay attention to the vocabulary you use. If you’re conscious about your word choice, you won’t have five people leaving the meeting thinking and doing five different things.

Be an Active Listener: When was the last time you were complimented on your listening skills? Many researchers claim that listening is the number one most admired quality of a coworker. But you’ve got to look like you're listening.

I learned years ago, there are six main nonverbal cues that signal coworkers that you are, in fact, listening intently. Here is a great acrostic to help us remember: STABLE nonverbal communication. Squarely face the other person to demonstrate undivided attention. Tip your head occasionally when following along, nod your head only when you agree. Provide Attentive facial expressions to display agreement, confusion, or disagreement. Create a Barrier-free environment to help people feel comfortable and support more open disclosure and honest communication. Lean forward slightly to show enthusiasm. Eye contact demonstrates interest. People know you hear with your ears; they judge whether or not you’re listening with your eyes.

Listening is free, but not listening can be expensive. A minor adjustment in your listening behavior can have a major impact on your relationships. If you get into this effective listening posture, not only will people believe you’re listening, but it will probably improve your listening comprehension.

Kit Welchlin, M.A., CSP, is a professional motivational speaker and author and can be found at www.welchlin.com.

 

 

Online Courses

NACM's Credit Learning Center can keep your career goals on track by making continuing education as convenient as possible. You choose the courses you need and learn at your own pace, on your own time and anywhere you want.

Individual modules: topics delivered as one-hour sessions—ranging from bankruptcy, antitrust, credit applications, credit policy, construction topics, UCC, commercial collections, leadership and more! 

Webinars on Demand: an extensive library from NACM, FCIB and NACM’s Secured Transaction Services

Courses: Business Credit Principles, Business Law, Credit Law, Financial Statement Analysis, Advanced Credit Policy, Bankruptcy Bootcamp and more!

Learn more at clc2.nacm.org or contact the NACM Education Dept. at This email address is being protected from spambots. You need JavaScript enabled to view it. or 410-740-5560.

 

 

Construction Industry Plans for Ongoing Pandemic-Driven Changes to Operations

 

—Andrew Michaels, editorial associate

With 2021 on the horizon, the construction industry is moving forward with the pandemic in mind and, unfortunately, the same obstacles remain. A lack of in-person meetings is impeding some companies’ ability to conduct business, and there are rising concerns over the coming year’s cash flow. Yet, the show must go on, so construction professionals are exploring new avenues that hopefully bring them to the desired destination.

Maintain Relationships
No project can be completed without building relationships outside the company because there are simply too many parties involved. Owners, general contractors, subcontractors, material suppliers and more are the gears that keep a project in motion when working together. This is evident to Peggy Marker, president of Fort Lauderdale, Florida-based Marker Construction, who told Construction Dive that developing and maintaining her client relationships is a “long-term focus” in the age of COVID-19.

“My biggest concern is finding a way to generate and develop relationships from afar,” said Marker, who is back to meeting with clients in person, albeit, with new safety measures in place. “No matter how many phone conversations or Zoom meetings you have, it's hard to seal a deal without actually meeting the person and really getting a sense of who they are.”

The same issue extends to construction credit professionals and material suppliers who also want to know who they’re getting into business with prior to moving forward with a business relationship, said Chris Ring, of NACM’s Secured Transaction Services. Face-to-face meetings are risky by definition during a pandemic, he said, so those who can find creative and effective ways to maintain relationships and solicit new business in a virtual environment will keep their employees safe.

Although she is unlikely to abandon all virtual gatherings, Marker said she’s implementing new solutions for safer office meetings, such as opening office and conference room doors during meetings to improve ventilation as well as leaving the generic office setting behind for outdoor locations. Adopting these changes has proven beneficial, Marker told Construction Dive, as her company has brought on three new jobs in the midst of COVID-19.

“That's been a big relief, because you just don't know what's going to happen right now,” she said in the article.

Cash Flow Concerns
Not all businesses have suffered at the expense of COVID-19. In fact, businesses like subcontractor Gaylord Electric have experienced increased revenue— approximately $18 million (7%) in 2020 over the prior year, according to CEO Chuck Goodrich in a Construction Dive report. However, Goodrich said, 2021 may yield less-promising results.

"The definition of construction is that cash is king,” Goodrich said in the article. “And right now, cash flow doesn’t look that great in 2021. … We’re optimistic, but overall, we’re seeing a shortage of opportunities in September and October, with November and December usually being slower anyway.”
Data from the American Institute of Architects fuels Goodrich’s cause for concern, citing that nonresidential construction is due to retract in 2021. Gaylord Electric specializes in primarily nonresidential electrical subcontract work, Ring added, therefore, those who supply materials on job accounts for primarily nonresidential construction may face revenue shortfalls in 2021.

Cutting costs is certainly not the silver bullet his company can rely upon in the long-term, Goodrich noted, but it may alleviate some pressure until a more permanent solution is found. The CEO told Construction Dive that he is constantly communicating with his investors, bankers and customers to “make sure they know where he is, so that if he needs to tap their support, he can, especially if cash flow goes negative in early 2021.”

“We have a great relationship with our bank, and we haven’t had to use our line of credit very often,” Goodrich said in the article. “But we’ve been communicating with them to let them know what we’re doing, and what our strategic plan is.”
The path to successful business may be altered as the pandemic continues, but construction professionals are adamant that they won’t be throwing in the towel any time soon.

 

 

Online Courses

Quicker delivery speeds do not mean giving up on fresh investigations. Each next-business-day credit report from FCIB is freshly investigated at the time that you order it. 

Get the key corporate facts you need to set credit limits quickly, including:

  • A robust predictive credit risk rating
  • Legal filings, bankruptcies, judgments, and liens
  • The latest financial and shareholder information

FCIB Reports meet the due diligence requirements of trade credit insurers and government-backed funding programs. To learn more, please contact David Anderson at +410-423-1840 or This email address is being protected from spambots. You need JavaScript enabled to view it., or click here for sample reports, pricing and ordering. 

 

Retail Leveling Out After Pandemic Surge

 

—Chris Kuehl, Ph.D., NACM economist

One of the first sectors to emerge from the pandemic mess was retail. It also seems to be the first that might have started to run out of momentum. The lockdown was unexpected and slammed retail with closure demands for all but a handful of “essential” services.

This left consumers unprepared and created a certain level of pent-up demand that was released when the lockdown was partially lifted. Retail sales surged by more than 18% in May as the stores reopened but almost immediately the pace slowed down with a gain of 8.6% in June and only 0.9% in July. Now, we have even lower August numbers when the expectation had been that there would be an improvement to perhaps 1%. The latest data shows a gain of just 0.6%. Core consumer prices fell by 0.1% when the expectation had been that these would increase by 0.9%.

The sectors that saw the biggest decline included department stores, grocery stores and to some extent gas stations. The product categories that saw the biggest decline were those that had been doing so well earlier in the year—sporting goods, music and hobbies in general. Some of the sectors that have been declining have been seasonal—lawn and garden has had its time in the sun but crashes about this time of the year.

The interest now shifts to the holiday season, and there are not many clues as yet. The back-to-school sales have been miserable because there was no real return to school to spark clothing sales and supplies. This leaves Halloween as the next big date, and thus far it has been slower than in past years. The last few years have seen this become an adult holiday with lots of themed parties, and that pattern is now in some jeopardy.

It is clear that retailers are pushing for another early season and an inventory light strategy. The idea is to turn the whole month into “Blackvember” rather than just the one-day Black Friday with early sales and deep discounts to lure the early shoppers. There is more intensity as far as this strategy is concerned as it is expected that cases of COVID 19 will spike as the weather worsens and that could drive people away from the stores and could even provoke another set of lockdowns. This will punish the procrastinators and leave them with limited options. A study a number of years ago revealed that of those men that shopped the last two days before Christmas, fully half of them bought all their gifts at a convenience store.

The expectation is that home-oriented goods will drive the majority of demand, and there is expected to be a decided decline in demand for luxury goods that are meant to be displayed in public at parties and gatherings. There will be more focus on “nesting” and purchases that can be used to soften the blow of semi-isolation and an inability to travel to be with relatives and friends.

 

 

 

NACM Secured Transaction Services - Lien Navigator

What do I have to do? When do I have to do it?

The STS Lien Navigator has the answers and will guide you through the entire process!

Credit professionals can rely on the Navigator to determine when and how action needs to be taken to protect lien rights across the 50 states, DC and Canada. The real-time Navigator ensures that you’ll always have the current information.

Specific questions are also answered for subscribers through the Navigator Answer Line. The Navigator is a web-based service, accessed through our website and available from any computer with internet access.

Navigating the Way—On Time, Every Time

For more information, call Chris Ring at 410-302-0767 or visit www.nacmsts.com.

 

 

Credit Insurance During COVID-19

 

—Michael Miller, managing editor

During these uncertain times, everyone is looking for protection. That can come in the form of wiping down grocery carts, wearing masks and washing hands for those trying to stay healthy. Companies on the other hand are fighting for their financial health with tools such as credit insurance.

“Companies cannot survive if they have to pay cash in advance for all of their supplies,” said Clay Sasse, a managing director with Aon, on a company podcast. “The entire economy depends upon credit. In recessionary periods, it’s essential sellers of goods who are called upon to extend credit to keep the economy moving have some support to give them comfort to do it.”

This is where credit insurance steps in to give credit departments and companies selling on credit peace of mind that there is a safety net should something go wrong with a customer or payment, e.g., insolvency. The pandemic has put a strain on the economy and on all parties involved in making the economy flow again, including credit departments/insureds, debtors and insurers.

“Early on, we saw some quick action from the market as a whole,” said Scott Pales, senior vice president—political & credit risks, financial solutions with Willis Towers Watson. “Cancelable carriers quickly came out and provided flexibility with regard to reporting through the crisis, making it easier for insureds to report under the policy.”

There were also recalibration exercises on rates and buyer risk, taking the pandemic and sectoral risks into consideration. For many insurers, there were cancelations and reductions due to the recalibration exercises. All insurers were in a conservative position regarding new business inquiries, especially early on. Many insurers were concentrating on evaluating portfolio risks.

Fast forward to August and September, the credit insurance world seems to once again be considering top line, said Pales. “They have done all their homework on portfolios to make sure policies are shored up and in good order. This doesn’t mean that new business activity is back to pre-COVID levels. They are still conservative, especially in key sectors.” Despite the renewed consideration for new business, there are still sectors that are, for the most part, off cover because they are heavily affected by COVID-19—airline, retail, travel, hospitality, oil and gas. Those particular markets are still exceptionally difficult to underwrite or are off cover completely. “We’re hoping as we progress through the pandemic and insurers gain a greater degree of visibility into how these risks are going to manifest that we can see sectors come back into play from an insurance underwriting perspective.”

For those insured with current credit limits, some of those credit limits are being reduced or not renewed at renewal. For other insureds with small credit limits, there is the potential these may be approved at renewal. “Insurers aren’t looking to accept that risk until they can fully see into what will happen with regard to COVID-19—will there be another resurgence, more shelter-in-place orders, etc.,” said Pales. “They don’t know what to expect as we progress through COVID-19.”