Why You Should Add Supplier Risk Management to Your Credit and Collections Skills

Credit professionals who add managing supplier risk to their skill sets can increase their odds of survival in credit as automation increases.

Remember when clearing new credit applications was a 20-30 day process? Reference letters were mailed out and you hoped that you would get a response. Credit reports had to be built and that could take anywhere from 2-3 weeks. Keeping track of the A/R was done from green bar computer paper and you would use a marker to indicate that a payment was made. The rest of the day was used for collection calls and other manual tasks.

Fast forward to 2018. It is reported that 80% of the credit function is now automated with scoring models approving a large percentage of accounts and the internet accelerating the other jobs that used to consume most of your time.
Has your role or more importantly “value” to your company been diminished by this new technology? What will the job description be in ten years?

Those who “get in front” of this change will increase their odds of survival and a great way is to expand your risk management skills to the vendor side.

Supplier risk management is gaining more traction as companies reach out to vendors globally. Who better to analyze the potential red flags of doing business with a new or existing vendor than someone who has been performing the job on the customer side.

Is your primary vendor sufficiently capitalized to continue supplying you with raw materials? Do they have the capacity to produce product for you if they bring on a new customer? Has anyone vetted the shipping companies used? Do you have a secondary supplier and are they financially stable if there is an interruption with your primary? What about the political situation in the country? A supplier risk manager knows the answers to all of these questions.

Working with your procurement department or whoever seeks out new suppliers can expand your role and value to your company. Just ask management to consider what would happen to sales and market share if you were not able to get product from your vendors domestically or internationally for 30 days.

For the past 3 years, CMA’s Supplier Risk group has brought companies such as Nestle and Pepsico together, exchanging best practices to assist those entering this field. You do not have to be with a Fortune 100 company to learn from these “credit managers” on how to position yourself in this growing profession.

Check with anscers and the CMA News for the time and agenda of the group’s next meeting and get in front of the next generation of credit management. For more information, email us at info@emailcma.org.

CMA Promotes Credit Management to the Next Generation at UCLA Career Fair

In an effort to explain credit management to the next generation, CMA’s partner Quote 2 Cash Solutions LLC, represented by Robert Shultz (Partner) took part in a panel discussion and career fair at the UCLA Extension campus on May 14. Titled “Career Success in Accounting and Finance,” Shultz, one of three Panelists, emphasized the importance of the credit function, fielded questions and later spoke privately to students interested in learning more about opportunities in this field.

“CMA believes it is imperative to attract young talent to the credit management profession. In talking to some of these students at the event, I am encouraged about the future generations of credit managers,” CMA President and CEO Mike Mitchell, who addressed questions at the CMA booth, said. “Our goal is to help ensure that there are plenty of great new credit management candidates for CMA members to hire.”

Shultz commented, “my most interesting take away was the one hand raised, out of the eighty or so attendees, when I asked how many understood the functions of a corporate credit department. This sort of outreach is an invaluable step to increasing interest and awareness of the credit profession.”

Here are a few photos from the event.

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