credit control
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A proper credit control administration is vital to the healthy continuation of cash flow in your business. Managing your customer debts and their purchases from the actual sale to finalising payment is what we mean when we talk about monitoring credit control.
Credit control incorporates debt management and recovery and starts with your policy on customer credit. Simply waiting for payment on goods you have delivered on a credit agreement is not good business practice in the twenty first century, you must outline procedure and stick to it.
Once a credit agreement has been authorised the customer must be made aware of the terms of your company credit policy. These things are minimum and maximum credit allowance and payment conditions that you have set out in your contract with your new customer. It is commonplace in business for different companies to have different levels of credit, but procedure in credit control must always follow the same rules no matter who you are dealing with, as this will help you to avoid any confusion and mistakes where credit is and isn’t due.
Raising an invoice creates a real and visible limit on your payment criteria. The norm is that you send out an invoice between forty eight to seventy two hours of the order and apply a thirty day limit for the bill to be settled. With new customers you might employ a deposit scheme until you have built up a working relationship. Good credit control practice is make sure you outline the ramifications of failure to comply with payment plans and include minimum and maximum penalty charges.
If you would like some professional advice on credit control, what works and what doesn’t then you should contact us direct where one of our helpful and friendly team will be happy to answer any questions you have.