Positive Credit Management

Credit is often viewed as a negative function and I have devoted most of my working career to change this perception.

Proper credit management provides the cash required to keep the business running.

The only reason to give credit in the first place is if it helps you to sell more, so giving credit is and always should be a pro sales function.

Managing and controlling the cash is a pro-finance function.

Making sure you have full and correct details on every single customer is a pro-compliance function.

Keeping customers happy and buying is everyone’s function.

All of these roles can be rooted in the credit function with a little effort that gives huge rewards.

Through proper assessment and account management the credit function ensures you are dealing with customers who are both willing and able to pay their bills as they fall due. When the money that is owed is paid in full and on time you turn all your sales into profits, which after all is what business is all about.

When it comes to areas like customer service or in current parlance “customer experience”, the credit team are best placed to know how to serve all your customers better, if you take the time to listen to them.

They know everything that is going wrong in the business, from pricing to short deliveries to service failures, as every glitch ends up on the credit controllers desk with a note: “We are not paying this because…”. So rather than focusing on the negatives, find away to turn every problem into a learning experience, that will help you to serve your customers more professionally.

Make sure your credit team are trained and educated to know the right things to do and when to do them. More importantly give them the space and recognition they deserve to become the engine of excellence within your organisation.

Declan Flood, The Credit Coach and Chief Executive of Irish Credit Management Training.