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What is the best way to request financial statements from privately held companies?

Answer: Here are some tips:

  • Try to make your request for financial information seem routine. If challenged, explain the need for the information as simply a 'routine update.'
  • Notify the sales department that you intend to request financial information because customers sometimes complain to their salesperson and/or ask their salesrep for the reason for the request.
  • Always request a Balance Sheet, Income Statement, a Cash Flow Statement, and Notes to the Financial Statements. Each of these four items is important to properly analyzing your customer's financial condition.
  • Request the financial data from a decision maker, not a clerk.
  • If confidentiality is a concern, offer to sign a confidentiality or non-disclosure agreement.

It is not always possible to convince privately held customers to share financial information. Unfortunately, depending on the circumstances, it may be necessary to issue an ultimatum --- either the customer provides the financial data you need or you cannot provide the quantity of merchandise your customer needs.

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