Tag: Best Practices

The credit department’s everyday work touches on every part of a company, from the sales team to the IT department. Naturally, when those inter-departmental bonds are strong, the work in credit can be a lot easier. Cross-training is a valuable tool that helps the credit team develop an understanding of how each department runs.

It’s easy to get frustrated when a suddenly unreachable customer is not paying what they owe. But before you write off the account, skip tracing is another way credit managers can secure payment and hold debtors responsible.

If you think about it, a company’s balance sheet is like a student’s report card. Rather than disclosing a student’s academic performance, subject mastery and behavioral progress, it reveals a company’s financial position in terms of assets, liabilities and equity.

To those outside the industry, business-to-business credit management can appear cut and dry. Bound by a strict financial agreement, a company sells a product or service on credit terms to a company that agrees to make payments until the debt is cleared.

Every credit manager has seen it at least once: a customer submits a payment order with terms lined out that differ from previous agreements. These situations are tricky to navigate, with credit managers reevaluating a customer’s creditworthiness through the lens of these new terms all while wondering if the customer is allowed to break the old agreement.

Business credit, in theory, is a pretty straightforward concept. A company decides to purchase a specific product or service from another company. Rather than paying in full upfront, they apply for credit terms.

Contract review is a core responsibility for credit professionals, requiring careful attention to detail and consistency across agreements. However, when managing high volumes under tight timelines, even well-established processes can leave room for key terms to be overlooked.

As more credit department functions transition to online platforms, credit professionals may find themselves working with customers to find the best way to transition away from traditional payment methods towards more streamlined online platforms.