“We WILL get through this together.” 

Here are a few things you should do with your vendors:

• Do Not Pay Any of Them Until You Negotiate: cash is precious. You must preserve it. Do not pay anyone until you talk to them. Remember, once you pay them and then try to negotiate, you are in a much worse position. When you withhold cash, you have a lot more leverage.
• Past or Present Doesn’t Matter: remember cash is the ultimate judge. It does not matter whether the money you owe is from from the past, present or future. Cash is cash.
• Banks and Credit Cards: banks and credit cards are providing for deferral of mortgage payments and credit card payments.
• Rent: many states are prohibiting foreclosures and evictions for a period of time.
• Utilities: many are providing deferrals and abatements.
• Don’t Worry Too Much About Legal Agreements: in these conditions, you have to think cash first. There will be plenty of time to sort out legal obligations.
• Force Majeure Provisions of Contracts: there are provisions of many legal agreements that allow you to get out of legal obligations because of extraordinary circumstances. It is unclear whether COVID-19 will qualify, but if your agreements do have this provision, you should claim that this provision applies.

There are right and wrong ways of doing everything. Please reach out if you need help negotiating with your vendors. We are here to help.