Credit managers, are you involuntarily contributing to this situation by lack of communication?
With some customers, getting the purchase order is a long process that involves significant work by your salesperson. It is easy to understand how frustrating it may be if at the end of a long process it turns out that the company is not creditworthy. There is no simple solution to this problem, but the credit department can help by working with sales as early in the process as possible and by evaluating the creditworthiness of the company and sharing information and insights with sales.
I know some of you will agree that is not always possible to offer a definitive answer about a potential customer’s creditworthiness until you have completed your review process. However, the fact that you provide any guidance to your sales department in advance is better than sitting on your hands and waiting for these orders to be submitted.
I choose to work with my sales team to help alleviate frustration. How about you?
Michael is the author of the Encyclopedia of Credit (www.encyclopediaofcredit.com), a free, fast, internet resource for credit and collection professionals. He is a consultant, and the author of “Credit and Collection Forms and Procedures Manual” as well as a frequent instructor at CMA-sponsored educational events. He can be contacted at 949-584-9685.