The CEO’s Perspective

The financial headlines have blared out the news that debt, in various forms, has overwhelmed the abilities of cities, companies, and countries to pay their obligations. In Illinois, burdensome unfunded pensions, exceeding the gargantuan sum of $100 billion, have helped make this once proud and thriving state a poster child for “what not to do.” The city of Chicago has also seen its credit rating decline, struggling with its own pension funding. Can promises made to constituent groups be kept? Time will tell.

The problem of debt is not relegated to government entities. In the produce industry, commercial debts—taken on via verbal handshake—are honored time and again. My friends shake their head in wonder when I explain how open credit for thousands of dollars is extended by sellers to buyers (many of whom have never met) through the strength of a Blue Book rating. Talk about “trust”! Is trust out of date? Is integrity a thing of the past? Is one’s word—that a buyer will pay the seller in say, 28 days—still an accepted way to do business?

If these hallmark methods are out of step, then the industry that has long been a shining example of “how to do business the right way” is perhaps not doomed, but in for a big change. Some argue today’s produce industry operates differently than that of previous generations—namely, that people are less honest, more greedy, and less trusting. There is certainly some truth to these statements, but I believe our industry is still filled with men and women who make promises…and keep them.

Pay remains within 21 to 35 days for the majority of Blue Book listed firms. While each firm’s rating and pay description are unique, the produce and transportation industries continue to be driven by the concept of “open credit,” or better said, “I believe you will pay as agreed.” Does this variation in days to pay portend an upheaval in trust and how businesses will deal with one another? I do not think so. The underlying moral philosophy—namely, that trust is at the heart of all commercial dealings—is still alive and well.

Debt, taken on for the wrong purposes, is not a smart move. Promises made that knowingly cannot be kept is just plain wrong, morally and legally. The industry is smart enough to know who is who and what is what. The free market of buying, selling, and transporting fresh fruits and vegetables works; prices change, due to supply and demand, but information is available to make good business decisions.

Blue Book Services is pleased and proud to be a part of an industry that makes promises, with the intent and ability to meet them.