In the Dark, by Michael C. Dennis

Your company’s pricing is predicated on certain assumptions about risk mitigation, payment delinquencies and bad debt write offs. Even with customer financial statements in hand, the credit decision can be complicated and the answer may be unclear. Without customer financial statements, you are truly in the dark about the amount of credit risk you are accepting.

We all recognize how limited a credit evaluation must necessarily be without customer financial statements to evaluate.  I am not suggesting that you should never make decisions in the absence of customer financial statements. Instead, I’m suggesting that if you must go into the dark, do so with your eyes wide open.

CMA offers some tools that can help “shed some light” on that amount of risk.  By utilizing the reporting services that CMA offers, such as those by D&B, Experian and Equifax, plus its own anscersX reports, anscers RFI service, and industry credit groups, you will get a more complete picture of the factors that could affect the amount of risk your company would want to take on.

I never like to fly blind. How about you?

As always, I welcome your feedback.

Michael is the author of the Encyclopedia of Credit (, 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.

Leave a Reply

Your email address will not be published. Required fields are marked *