Credit Management Tips

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E-books and Guides

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For your reference, we have collated a selection of our Credit Management Tips that we have garnered through over 25 years of industry experience.

Also available to purchase for only $14.95 is a 26 page e-booklet titled '52 Credit Management Tips' featuring a further 52 pointers for dealing with a variety of situations that may arise in your daily routine as a debt collector or credit manager.

8 Tips for Debt Collectors

Swapping Cheques - How to Handle Requests for ‘Swapping Cheques’

We owe you $100, you owe us $75 so we’ll pay you the difference $25 - no thanks!

Avoid this practise at all costs.  Balancing your books is difficult enough without having these sorts of entries appearing.  There is also the GST implications etc.  If your client owes an amount that is the amount you must collect.  Any variations may cause problems with your accounts payable people.

We'll Take Our Business Elsewhere - How to Handle Customers who Threaten!

Whilst trying to get an outstanding account paid some debtors who ‘have been pushed into a corner’ will threaten to take their business elsewhere!  Don’t panic!  Simply and calmly ask them to pay the account and then they can choose to purchase their goods where they like.  But by moving to another outlet this account will not disappear.  Also remind them that they may have to go through Trade Reference Checks and complete another credit application form at the new outlet.  What sort of reference does your debtor think you will give them?

Telephone Displays - How to Maximise Results when using the Telephone

Should you display your telephone number or not.  Depends on your customer base.  We believe that people with mobile telephones and land lines are curious creatures so when they receive a call from a number they don’t know they usually ring it to see who it is!  You being able to see the caller ID on your system is also an advantage when you can answer the telephone by referring to the customer by name.  Evaluate the best system for your credit department because there are a lot of debtors who refuse to answer a ‘private call’ or blocked user telephone number.

Telephone SMS - How to use Telephone SMS Services to Make Contact

Bosses have mobile telephones so why not use it to let him know that your outstanding account has not been paid?  Messages using the SMS function can be sent to multiple customers thus saving you a lot of time and expense.

Terms & Conditions - How to use Terms and Conditions as a Collection Tool

In your Terms and Conditions there are many areas that can be used in the credit department to convince the customer to pay the account within the trading terms.  Clauses that include interest, debt collection fees, solicitor and legal fees, penalty interest and account keeping fees – all help to persuade the customer to pay on time.  Then the excuse there was a problem with the goods or services – did the customer notify you in writing within 48 hours of delivery as per the credit application form – if not you may want to use this clause as a Collection Tool.

Threats - How to Handle Customers who say ‘you need them more than they need you’

Who is telling you this?  What authority do they have?  Who has made that assessment?  Why the threat?  Is the customer having cash-flow difficulties and using this line to try to ‘take the pressure off’?  Now is the time to ask plenty of questions regarding their cash-flow and when you WILL BE PAID.  Don’t get involved in who needs who the most.  This will not get the outstanding account paid!

Trade Reference Checks - How to Conduct Trade Reference Checks

When conducting these important checks ensure that you receive the information ‘that you want’, in writing, from the person providing the information.   List up to six questions, Length of time with the reference, monthly spend, how account is conducted, number of late payments, any returns, any other difficulties or problems with the customer or staff – or any thing else that you require.

Trading Terms and Conditions - How to Sell your Credit Departments Expectations to Customers

Always ensure that your customers know what your trading terms and conditions are!  By doing this you will be able to ensure that any course of action you decide to take (where there is a breach of the terms and conditions) will not become a total surprise to your customer.



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