Credit’s role in sales

When considering the work of a credit manager, it is impossible to overstate the importance of interdepartmental communication, especially when it comes to the relationship between credit and sales. While the two departments work in tandem, with the sales team securing customers the credit team will then manage, in some offices, the two can be a bit isolated. 

Why it matters: The mission of the credit department is to keep customers in the position of buying, an overlap with the sales department.

By the numbers: Despite their crucial role in mitigating risk and managing accounts, 22% of credit managers report that their input is rarely considered by their sales team, according to an eNews poll. Only 10% of respondents reported that their opinion was highly valued by their sales team, and a whopping 43% of credit managers feeling their opinions are valued but rarely sought out.

This division can feel confusing, especially when you consider how closely intertwined the work of the two departments is, with the company’s success being the central goal of both teams. While the two departments might feel at odds from time to time, a strong relationship between the two can be crucial for hitting targets, managing difficult customers and mitigating risk. 

To credit managers, this division feels odd. As a credit professional, you have a deep understanding of your customers’ habits and the risk they pose your company. It seems obvious that the sales team would seek out your opinion, whether it’s about closing a deal or bringing on a new customer, but the truth is, developing that relationship with sales takes work. 

For Jeff Cozad, business manager for Patz Corporation (Pound, WI), regularly touching base with his company’s sales department has helped both teams manage accounts. “At a minimum, we touch base in a weekly meeting that we hold for all department managers,” Cozad said. “I keep in regular contact with our sales reps to discuss any accounts that have collection issues, and they keep me informed on any potential new customers or any news they hear about existing customers.”

The key to a strong working relationship between the two departments is understanding each person’s role and what motivates them. “There is a mutual respect in understanding the importance of both of our roles in the sales order process,” Cozad said. “I know how challenging it can be for the sales team to find and establish new customers and to close a sale, and they know the challenges I can face in determining the creditworthiness of those customers. We both have the same goal of growing sales for our company, but it needs to be done responsibly.”

For David Escobar, credit manager at Evapco, Inc., (Taneytown, MD), working with the sales team is all about providing guidance and offering your advice on managing customers from a credit perspective. 

“We want to make sure that we have a good partnership overall that benefits both parties,” Escobar said. “It’s all about providing guidance when it comes to making decisions on a potential customer’s credit worthiness. So that we can say, ‘Hey, these are the reasons we think this is appropriate’ or ‘These are the reasons we should push back a bit.’”

For credit managers looking to build a stronger relationship with their sales team, it is important to advocate for more engagement between the two. For Brittany Yvon, CBA, CICP, credit manager at OMG, Inc. (Agawam, MA), working collaboratively with the sales team has allowed her to build a strong and beneficial relationship between the two departments.

“I’m way more visible to the sales team than any other previous credit manager with my company has ever been,” Yvon said. “When our sales team comes in for our annual sales week, I’ve been invited to some of their events so I can get to know them better. I also present to all the new sales team members about the collaborative sales and credit relationship and how our work is intertwined.”

The bottom line: By becoming more visible to the sales team and emphasizing the benefit to a collaborative relationship, credit managers can create a more open environment where their perspective is carefully considered and valued by their sales team.