Who Should You Give Goods on Credit? A Simple Rule for Bakery Owners

How to Know Who to Give Credit to at Your Bakery

The simplest rule for giving credit is this: Only give credit to people who have paid you back on time before. It sounds obvious, but many bakers, especially when busy, forget this golden rule. You see a familiar face, they ask for a few loaves or a dozen buns, and you hand them over. But have they always paid you back quickly? Have they ever forgotten? If they have, even once, be extra careful.

Think about it like this: if someone consistently pays cash or always settles their tab within a day or two, they have shown you they are reliable. They respect your business and your need to get paid. These are the customers you can consider for credit. For new customers, or those who have been slow in the past, it’s safer to ask for payment upfront. You can even ask for a deposit for large cake orders.

Knowing your customers is key. If you run a busy bakery, maybe in a place like Oshodi Market or Computer Village, keeping track of every single sale can be tough. But if you can remember who pays on time and who doesn't, you're already ahead.

What to Do When Someone Asks for Credit

When a customer asks for credit, take a moment to think. Ask yourself these questions:

• Have they bought from me before?
• How did they pay last time? Was it on time?
• Do I know them well enough to trust them?
• Is this a big order?

If the answer to any of these is 'no' or 'I'm not sure', it’s better to be safe. You can say something like, “Ah, sorry o, for this one, we need payment first. But next time, if you pay on time, we can talk.” Always be polite but firm. Your business needs to survive.

For larger orders like wedding cakes or party packs, it’s wise to ask for at least 50% payment upfront. This shows the customer is serious and helps you cover your costs for ingredients and labour. This is a common practice for many businesses, similar to how phone shop owners might ask for deposits on expensive items.

Keeping Track of Who Owes You Money

Even with careful selection, some credit sales will happen. This is where good record-keeping becomes your best friend. If you’re still using a jotter or a notebook, you know how easy it is for entries to get messy, lost, or forgotten. This is why many small business owners are switching to better ways to manage their business records.

Imagine if every time you made a sale, even on credit, it was recorded automatically. And when the customer paid you back, that too was logged instantly. This is what TrustAm’s WhatsApp Business Assistant does. When you send a payment request, it’s recorded. When they pay, the debt is cleared. You can even record cash sales or credit sales by sending a voice note or a quick text. This means your books write themselves, even when you’re busy serving customers at the counter.

TrustAm also has a special debt book. You can record who owes you, how much, and when it’s due. If a customer is late, TrustAm can send them a polite reminder message with a payment link. This helps you collect your money faster and keeps your customer relationships smooth.

The Danger of Fake Alerts

One major risk with credit sales is fake payment alerts. A customer might claim they’ve sent money, but it never arrived. Without a proper system, it’s hard to verify. TrustAm solves this by issuing a stamped receipt to both you and the customer the *instant* the money lands in your account. This makes fake alerts almost impossible because the payment has to be real and confirmed for the receipt to be generated.

This is crucial for bakery owners. You can’t bake more if you don’t have the cash for ingredients. Relying on unconfirmed payments can halt your entire operation. Always wait for confirmation in your bank app or for the TrustAm receipt before handing over goods, especially for credit sales.

When to Say No to Credit – Even to Regulars

There are times you have to say no, even to your best customers. If your own finances are tight – maybe you’re waiting for a big payment yourself, or you need cash for urgent supplies – you might have to temporarily stop offering credit. Explain the situation honestly: “My dear, I’m sorry, but right now, we are only accepting cash or transfer. We need to buy supplies for more production.”

Also, if a customer’s credit history with you is patchy – they’ve been late paying before, or you had to chase them for money – it’s a sign to be cautious. You can use your TrustAm debt book to see who has outstanding payments. If someone consistently owes you for more than a week or two, it might be time to ask for cash upfront for a while, or even stop giving credit altogether until they clear their balance.

TrustAm Makes Credit Management Easier

Managing credit is a delicate balance. You want to support your customers, but you must protect your bakery. TrustAm’s WhatsApp Business Assistant is designed for busy traders like you. It lives inside WhatsApp, so there’s no app to download. Every payment you receive can automatically update your sales records and clear outstanding debts. You can send payment requests with unique account numbers that expire in 24 hours, helping to enforce exact payment amounts and prevent confusion.

For cash sales, you can log them with a quick voice note or text. For expenses, you can snap a photo of a receipt or send a voice note. Every evening, you get a summary of your sales and expenses, so you always know where you stand. This helps you make smarter decisions about who to give credit to, and when.