Take control of your credit control


Guest post by Declan Flood, the Credit Coach and Chief Executive of International Credit Management Training. Declan provides credit management education and training to a broad range of businesses.

Anyone not familiar with credit control or credit management may have the impression that the job is all about fighting with customers as you struggle to get the debt collected.

In reality, this could not be further from the truth. Great credit controllers treat their contacts as friends and know that working with people is far more effective than working against them, they strive to build strong working relationships with all of their customers.

Rather than having problems with customers, many would be surprised to learn that most of the problems experienced by the credit team are internal, no invoices, wrong invoices, wrong prices, wrong quantities, no purchase order numbers, incorrect legal entity….the list goes on and on.

Many credit controllers spend most of their days dealing with queries and disputes from their customers and not ringing long lists, as some might think.

I cannot stress enough how important it is to have an effective system to get your invoices right. That means: correct name, correct address, correct content, correct details and delivered in a manner the customer requires to the correct person within the customers’ business.

Then you must have correct terms, correct credit lines and the correct collection methods to ensure timely collection. Most importantly, if you want your credit staff to be productive, you must have an automated document retrieval system that gives instant access, to every credit controller, to every relevant document including invoices, signed delivery dockets etc. when they are on the phone, and not to have to go searching for documents at a later stage.

If getting paid is important to you and your business, follow these guidelines and watch your success explode. Fail to do this and you are doomed to have ageing buckets crammed with overdue invoices. In the current world that is on the brink of the biggest recession we have ever seen, the longer you leave invoices outstanding, the greater your losses will be when businesses fail.

MY advice to all reading this is to focus on getting paid, and take your credit function seriously, and not just to give it lip service with pithy sayings like “Cash is King” and “It is not a Sale until it is paid for” – while both these sayings are true, they have to be backed up with proper resources, and properly trained and educated staff who have proper systems to work with. Can you afford not to?