An applicant provided three references. One was a creditor. One was a public
utility, and the third was their landlord. I told the applicant that I needed
three trade references and had received only one. The applicant disagreed.
Sales management disagreed. What do you think?
Answer: I agree with you.
The landlord is not a trade reference. If the tenant does not pay the landlord,
they get evicted. By the same token, if the applicant does not pay its utility
bills, service is suspended. Trade creditors do not have the ability to evict
customers or to deny them access to essential services. Therefore, a lease
holder and a public utility have leverage with customers that general unsecured
trade creditors do not have.