Business Credit Control Tips for 2020
The New year is here and Business Credit Control is more important than ever. The beginning of 2020 and a new decade is a great start for new practices in your Business. It can provide the chance to implement new Credit Control procedures for your Business. It is not a case of reinventing the wheel, more a chance to tweak existing workflows.
For any UK Business, a efficient Business Credit Control strategy is imperative. It will help you manage company cash flow and keep a Businesses finances healthy. A Business should always seek to be operating at maximum profitability.
Business owners sometimes purely focus on acquiring new business in the hope of fresh sales. Whilst this is natural, the same tenacity should be applied to all other areas of the business too. Lacking the same sense of purpose for other day to day tasks can affect profits. Making sure payments are made on time is of the utmost importance in terms of profits.
Time spent chasing late or non paying customers can have a catastrophic effect on your Business. Proficient Business Credit Control methods will provide a smooth day to day operating business. Preventing late payment of invoices will minimise disruption to business cash flow. Never underestimate the value of sufficient Business Credit control practices. Preventing bad debts is always much easier than finding a cure. It is also much cheaper overall.
Whilst we specialise in debt recovery for businesses, we thought a few handy tips might help. Keeping Business risk to a minimum is a no brainer for any Financial Controller. So to help UK Businesses, our Expert Commercial Team have put together some tips. You will probably be already using such methods but a refresher will not hurt.
1 – Monitor your clients Credit rating
A Simple but effective measure. Most firms do this as a standard part of their Business Credit Control. Amazingly some still do not and rely on trade references.
All of your customers ratings need to be reviewed periodically. A Company’s credit rating can change very quickly and you need to be aware of changes. There are some great Business Credit Rating software packages out there. Experian are a port of call for many along with Risk Disk and Creditsafe.
These can alert you to decreases in Business Credit ratings and allow you to act therein.
2 – Efficient Company invoicing
Incorrect invoices being sent is a far more common problem than many think. Where there is still manual invoicing, quality is essential to avoid issues down the line.
Payments are often delayed for businesses by inconsistencies or errors on invoices. Bad payers love the opportunity to exploit this so ensure you have an efficient invoicing practice.
3 – Make Payment terms clear at outset
One of the most important factors within Business Credit Control. Ensure your customers know what the payment terms are for all your invoices. This eradicates the potential for any confusion as to when your invoices should be paid.
4 – Flexible payment facilities
The old saying of Cash is King is long gone. The more modern payment options you have, the better. Online payments and payment via card are very much the done thing in business now. This has helped many Business protect themselves against bounced cheques which were common at one time.
5 – Maintain your Business relationships
Research shows that Customers are far more likely to ensure payment dates are kept with a friendly Credit Control approach. As Patrick Swayze once said in the film Roadhouse; “Be nice until it’s time not to be nice”
Regular Customer service calls can act as a reminder for payment dates. A simple call a couple of days before can ensure payments are made without issue. It is also good practice to routinely engage with clients.
When payment dates are missed, a more pragmatic customer service approach. A courteous yet firm tone will prevent any negative escalation in the matter.
And if a customer still doesn’t pay……
Speak to the leading Professionals in Business Debt Recovery. We pride ourselves on being the most accredited Business Debt Collection Agency in the UK. Our Expert Commercial Advisers can review the situation for you and offer the best possible solutions.
We provide a Low fixed cost service that has been trusted by 1000’s of Businesses across the UK since 2004. Every year we collect millions of pounds for our clients in unwanted Business Debts.
If your Company wanted to maximise its Business Credit Control then call us today.