Respond to peer in 175 words or more
The management strategy that I chose is to ask for a deposit or milestone payment. The rational behind this choice is that it allows the company to receive a deposit or partial payment as a good faith gesture that they will complete the payment once the product has been delivered or service has been rendered. It is a method of trust on both parties, but most are willing to participate in this method if they can put down a percentage of the whole amount as opposed to paying whole amount all at once. It helps to increase capital because you have a partial payment or deposit with the promise of full payment once the transaction has been met.
When I was looking to purchase a home, this is the method that was used. Our home was being built and we had to put down $2000 and show that we were approved for purchase as a sign of good faith. Once the money and proof were given, they began work on the house. It took 7 months for the builders to complete the home and payment was not due till the completion of the build.
I think this is a very smart method in the fact that you may not have full payment coming in, but you will have income coming in and more people would use this method knowing that the full cast up front is not needed. I can have the approval of purchase right now, but may not have the full purchasing amount on me right now.