Before anyone clicks on the comment option to say that a business would not exist without sales, let me say that you are absolutely right. Sales is the engine of business, but the credit team manage the fuel (cash) that enables it to drive forward.
My question is really aimed at identifying where sales processes could be improved to reduce costs and eliminate wasted time for credit teams. The rationale for asking the question comes from data captured in the OnePosting Credit Management Benchmark.
Hard facts from the benchmark are combined with feedback from benchmark participants in this article to identify areas where small improvements in the sales process could have a beneficial impact on credit management.
Continue reading How much does the Sales Team Cost the Credit Team?
In the Credit Management Benchmark assessment, we listed seven common queries received by credit/collections teams and asked participants to rank them in volume order, i.e. the most frequently received query first, followed by the next most frequently received one, and so on through the list.
The number one query received, by a very significant margin is requests for copies of invoices. In the age of modern communications, how is this possible?
Continue reading #1 Query Received by Credit Teams
When developing the Credit Management Benchmark, I made the initial assumption that a high credit note to invoice ratio is not a good thing. After all, payments on invoices are normally delayed until credit notes are received and processed. There are also the costs associated with preparing, approving, recording, distributing and allocating credit notes.
However, there are some circumstances in which a high ratio is normal practice.
Continue reading What Does Your Credit Note to Invoice Ratio Mean?