Hot Tip: Purchasing Discounts

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Art Allen, founder of Allen Systems group, an enterprise software company in Naples, Fla., looks to his major suppliers, such as Xerox, to help his company qualify for discounts on other items, such as shipping costs. But business owners whose orders aren't big enough yet to win that kind of benefit should look for discounts elsewhere, through industry groups.

Young companies that rely heavily on credit cards are finding that card issuers may offer many good purchasing discounts. Marcello Serrato, owner of Prestige Auto Specialists, in Boca Raton, Fla., a 14-year-old company with sales under $1 million, says, "My time is very precious because every minute that I spend on my company can be turned into money. But I don't have the time to spend comparison shopping whenever we need to make a major purchase." Instead, he calls American Express, whose credit card he and the company have used for nearly a decade. "I just upgraded our computer system and bought IBM machines, since AmEx gave me a 10% discount as well as its extra warranty. I also use Federal Express, since our credit card qualifies us for a discount there."

This article was adapted from material that first appeared in Inc. magazine in July 1999.

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