Cash flow is the lifeblood of any firm. A business cannot invest in new items, pay expenses or add new personnel without it. This is when credit control walks in as it is the way to ensure that one has enough money to fund their operations.
In simple words, it is the process of managing a company’s accounts receivable and the invoices that has been sent to the clients. However, managing it can be daunting unless you follow the tips mentioned below to improve the process.
Research Customer Credit Management
One of the first credit management techniques that you can opt for is to research customer credit management before extending credit.
Though creating credit reports can be expensive, this method should not be missed. Find out which clients offer danger and focus on investigating them. This would help in offsetting some of the costs.
Build a Positive Working Relationship
You can improve the credit control process by creating a pleasant relationship and open communication with the payment defaulter. Take out time to make courtesy calls to confirm receipts of paper or before.
This would not only demonstrate your professionalism but also allow the clients numerous opportunities to clarify their circumstances.
Quick and Accurate Invoices
This is one of the simplest ways you can enhance credit control operations. By providing prompt and correct invoices as the
Credit Risk Solutions, you would be assisting your company to improve its effectiveness.
For instance, as soon as the orders are fulfilled, opt to send email invoices instead of mailing invoices. Also, make sure that they are sent to the right person and that the invoice is free from errors.
Insist Early Payments
Making it as simple as possible to pay invoices will encourage early payment. Remember to state all the financial information properly on the invoices and mention the alternative modes of payment available.
Furthermore, another way of promoting or insisting on early payment is offering incentives for doing so.
Automate Collection Process
To reduce the hard work and improve the credit control process, automated collection process methods can be adapted. This would impact every stage of the payment process and minimize manual errors.
On the other hand, updating the records can result in more efficient customer service and tax reporting. Additionally, to prevent excessive delays, you can set up automated email reminders.
Monitor Existing Customers
It is important to know that credit control is a continuous activity. This is why it is important to create recurring reviews into the plans to track and evaluate the risk of both new and existing customers.
Chances are you may also offer the customers better terms if they tend to establish a track record of timely payments and raise credit scores.
Make Payment Easier
The days of paper cheques and deposits are gone. Problems like cash flow can occur from failure in credit card payments and age-old techniques like bank transfers.
Therefore to improve the credit control process, companies are nowadays accepting electronic payments. This is because when customers find it simple to pay you, they are likely to make payments on time. Additionally, this closes the room for any payment defaulters.
Time to Improve Your Credit Control Process with Credit Q
Choosing professionals from credit information bureaus like us at Credit Q enables you to automate payment collection. Besides that, it allows you to reduce the time invested in administrative work that is handled by the staff while pursuing the bills. With years of experience, we assist you in initiating a business transaction and getting acknowledgment of the same.
