August 2019, the late payment culture continues to put strain on the cash flow of businesses across the country.
“An estimated 50,000 businesses a year close as a result of late payments” – Federation of Small Businesses (FSB)
There is hope though…
Credit Control personnel are becoming more and more vital to the lifeblood of a business.
Whether you are a hands-on Credit Manager, an old-school Credit Control specialist, a freelance Debt Consultant, a number-crunching Credit Analyst, or even an Apprentice MCICM studier it is important to recognise your worth!
Wade Macdonald’s Credit Recruitment Division are a fervent promoter of the fact that people employed in Credit Control do so much more than ‘call customers and collect overdue payments’.
Personally, I am massive advocate of the belief that hiring an effective Credit Control Specialist can transform a Businesses outlook.
Credit Controllers are constantly on the front line, with exposure to internal contacts and of course to customers (aka “ the debtor”).
Credit Controllers provide a crucial monthly cycle of processes and services and are expected to provide key advice and strategy in ‘real-time’ and also to be constantly building, improving and developing new and existing stakeholder relationships.
You are expected to be a Business Partner – at all levels.
When the Sales team within your business is billing high volume and high value sales, with customers all over the UK and beyond - the pressure to recover payments on time from a huge ledger of varied debtors seems never ending.
Being a Credit Controller can sometimes feel lonesome. Late paying customers can be difficult to track down or their reasons for delaying payment of invoices can also seem never ending.
Here in the first of a trilogy of articles; I will explore a number of simple methods that a resilient, professional and driven Credit specialist can employ to bring success...
Know your Customer & collaborate with your Salesperson
From the moment the order is placed or the sale is finalised, the Credit Controller, the Salesperson and the customer should have a clear understanding of what is agreed for all parties within your company Credit terms as part of the on-going trading process and ultimately for the future of the business relationship.
Fact: Your firm’s “Customer” is highly likely to become a “Debtor” at some point in the future.
Ensuring that the Sales Team utilise an effective Credit Application form from the outset can bring huge advantages to both new and existing orders.
Quite simply, if you want to make your life easier and achieve transparency with a “future debtor” you must make sure all the customer’s business information, contact, and purchase order details are filled out correctly from the outset.
Educating your firm’s Salespeople is crucial to the effectiveness of this simple administrative task.
Knowing Who placed the order, Who is responsible for ‘Accounts Payable’ and Who holds the purse strings is essential. Collecting all this information early and obtaining full contact details including direct telephone numbers will make the Credit Controllers job far easier in the long run.
You can also use this information to check a Customer’s credit worthiness and recommend credit limits for future trading with them.
Once communications are open, you should make sure they know who you are too.
Introduce yourself as the point of contact at the earliest opportunity and set out to build a relationship early.
Again, this should make your life easier and address any issues early and before payment difficulties arise.
To highlight my earlier point, hiring an effective Credit Control Specialist can transform a Businesses outlook.
Original author - James Adey