eNews Archive

Bankruptcy tends to stay out of the public’s focus–and by extension Congress’s–when the economy is doing well. That’s where we are now, with unemployment rates still sitting around 4% and inflation rates mostly under control. Because of that, Congress finally allowed the COVID-era small business chapter 11 bankruptcy eligibility threshold increases to expire. There has not been a major piece of legislation introduced since January that touches Chapter 11 or 13 bankruptcies.

As a credit manager, you are likely familiar with the sinking feeling you get after learning a customer has filed for bankruptcy. Whether they are aiming to reconstruct or liquidate their business entirely, customers filing for bankruptcies can send even the most experienced credit managers scrambling.  

The accounts receivable (AR) department is a vital part of an organization’s financial health, ensuring timely payment of invoices and maintaining accurate records of receivables. However, any sudden change in business environment, size or organizational structure can drastically affect how efficiently the AR department operates.  

NACM’s seasonally adjusted combined Credit Managers’ Index (CMI) for May 2025 improved 0.7 points to 54.7. “The improvement in May was somewhat unexpected given that 10% across the board tariffs were put in place the first week of April along with very high tariffs that affected all imports from China,” said NACM Economist Amy Crews Cutts, Ph.D., CBE.

Credit professionals routinely make decisions that directly impact cash flow, customer relationships, and the financial health of their organizations. One small misstep, whether it’s approving the wrong account or overlooking a red flag, can lead to significant setbacks. That’s why it’s so important to have skilled, knowledgeable professionals in these roles.

Under any circumstance, it is difficult to predict where the economy will be in the coming weeks, months or years. With ongoing trade wars between the United States and major trade allies and fluctuating tariffs that are subject to change at a moment’s notice, it can be even harder. 

Automation has significantly reshaped credit practices by streamlining processes, reducing manual errors and enhancing productivity. In the construction credit space, where efficiency, accuracy and timely decision-making are critical, automation has served as a powerful tool. 

The initial investigation into a potential customer’s credit worthiness is an essential step in the credit approval process, singlehandedly signifying the profession’s central goal: extending the right amount of credit that creates profit without introducing too much risk. While many credit managers are used to poring over a customer’s financial statements during this stage, many might not be analyzing as deeply as they could, unintentionally taking on more risk than intended.