Business Practices Archive

The causes of late payments are diverse and can negatively impact stakeholders across various industries—everything from supply chain delays, cash flow issues and invoicing errors. Credit managers must use proactive strategies to encourage timely payments from habitual and sporadic late payers.

We all know the saying “cash is king” rings as a true statement in the credit world. It’s critically important to look closely at where and how a business generates its cash, looking no further than the Statement of Cash Flows. This statement provides information on a business’s cash during a specified period, helping credit professionals analyze its financial health. Understanding cash flow is critical for assessing risk and the financial outlook of a company.

As we usher in the new year, we thought we’d examine the shifting currents of the workforce. Let’s unravel the latest labor trends and workforce challenges identified in eNews poll questions. A recent poll indicated that 32% of credit professionals point to an increased workload as a big challenge while navigating layoffs or workforce adjustments within their credit team closely follow. Maintaining team morale amid the fear of potential layoffs is a challenge for 14% of respondents and another 14% have struggled to hire and retain skilled credit managers.

New Year’s resolutions often symbolize a fresh start and a commitment to improvement—a chance to become the best version of yourself in both your personal and professional lives. As we approach the New Year, credit managers are presented with limitless opportunities for growth and success.

Credit management is a risky business. Every credit decision is directly influenced by ever-changing micro- and macro-economic factors. To better mitigate risk, credit professionals must be proactive in their credit limit assessments for new and existing customers. According to a recent eNews poll, most credit professionals review existing customer credit limits on an annual basis (64%), while some reassess credit limits as frequently as every six months (23%). Others reassess credit limits less often, such as 18 months (4%) or 24 months (10%) at a time. The frequency of reviewing credit li…

Due to supply chain challenges, more companies are seeking alternative suppliers, resulting in an increase in new customer credit applications. But even a well-established business that has been buying from other suppliers needs the same degree of risk assessment as a new company. How they abide by terms and pay other suppliers could be an indication of how well they will pay your company.

As the credit world continues to evolve alongside automation and technological advancements, there are many benefits: easier ways to receive payments, communication with customers and all around efficiency. However, with innovation comes vulnerability. Technological advancements in the past decade have made fraud a much easier crime to commit in the credit industry, especially through email phishing, forged digital documents, identity theft and more. And fraudsters are continuing to find creative ways to get away with their scams.

As the next generation of credit professionals accepts jobs in the industry, they are using a different strategy to build customer relationships by leveraging new communication styles. However, the goals remain the same—create a strong sense of trust, improve customer service and mitigate risk.