Top 5 Business Credit Control Tips for 2021

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Business Credit Control Tips for 2021

As we enter the start of a new year, this is the perfect time to overhaul your pre-existing credit control procedures. Doing this will allow you to manage your cash flow easily, which in the current economic climate we are faced with is extremely important.

There will have been a lot of businesses hit with financial difficulties in 2020 due to the Coronavirus pandemic, so tweaking existing workflows is a good way to start afresh and try to maintain and grow in the new year.

As one of our recommended partners, Federal Management has said in the past, a business should always seek to be operating at maximum profitability.

From experience with working with clients in the B2B sector, business owners have been seen to focus purely on procuring new business in the hope of fresh leads and sales.

It is extremely natural to feel this way as acquiring new business helps to sustain the growth of the company, however, there are other areas that need focus too.

It has been shown that if the same importance is put on every aspect of the business, no matter how small the process, this will affect profits.

As part of the Credit Control Process, it is strictly important to ensure payments are always made on time from clients and customers. If payments are late or not made, this can create severe consequences as you may need to waste time trying to recover the money owed.

Preventing late or non-payment of invoices will minimise any disruption to business cash flow and it is important to change your processes accordingly to know what to do when this occurs.

In this article, our team of debt collection experts have put together some tips for revitalising your Credit Control Processes this year and how implement these.

Top 5 Business Credit Control Tips for 2021

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Business Credit Control Tips

Top 5 Business Credit Control Tips for 2021

Here are our top 5 Business Credit Control Tips for 2021 to help you to manage the cash flow of your organisation and to keep your finances healthy.

Client Credit Rating Monitoring

Checking the credit rating of a client before working with them is effective as much as it is a simple thing to do. This is a standard practice amongst almost all Accounts departments but there are some organisations that do not adhere to this.

As part of this process, all customers that you work with must have their credit ratings reviewed periodically as to ensure no issues have arisen in their finances. The credit rating of an organisation can change fast and without warning, so it is always good to be made aware of changes.

Although there are many Corporate Credit Rating pieces of software on the internet, we would recommend using either Experian, Risk Disk or CreditSafe.

These are designed to notify the user of decreases in ratings and allow action to made therein.

Efficient Company invoicing

One of the most common problems that businesses face (and receive) is invoices being incorrect. This can be anything from wrong amounts of money, spelling mistakes in company names or wrong reference numbers – there is a long list.

If manual invoicing is still being applied as part of an organisations Credit Control Process, quality control is essential to avoid issues down the line. If errors are spotted on invoices by the receiver, this can create issues such as delayed payments or disputes.

Difficult payers will exploit this and use this as an opportunity not to pay you for the services you have carried out.

Instructing a proper invoicing system or enhancing your manual system could be crucial to maintaining or growing the cash flow of your business.

Confirm Payment Terms Prior To Services/Work Going Ahead

Payment Terms are an important part of any businesses Credit-Control system and allows both parties to know the terms in which payment will be made, and when.

These should be agreed on prior to any works being carried out and it is recommended to get it in writing and then signed by the client.

This will eradicate the potential for any confusion or excuses as to when the invoice is to be paid.

Top 5 Business Credit Control Tips for 2021

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Flexible payment facilities

It is extremely important in the everchanging world of technology that you adapt your payment options – the modern options you have, the better.

Over the past few years, the most important ways of payment have been through online payments or payments via debit or credit cards.

Adopting a modern payment procedure in your Credit Control Processes will mitigate any problems such as bounced cheques, which at one time were quite common.

Maintain Relationships With Your Clients

Not only will your organisation benefit from a positive and forward-thinking Credit Control process, but your customers will do also.

Research gathered over the last few years has shown that customers are more likely to pay on time and keep up with payment dates if the payment process is user-friendly.

Communication can go a long way when it comes to customer paying or not. It is a recommended practice to routinely engage with your customers and clients by communication via phone or email.

Regular customer service phone calls could be used as a reminder for upcoming payment dates and will ensure payments are made without any difficulties.

If you have been experiencing issues with payments not being completed on time, then a more pragmatic and efficient customer service approach to your credit control systems is required.

Always remember – a courteous yet professional and firm tone will prevent any negative escalation in the matter.

What To Do When A Customer Still Doesn’t Pay?

If you have implemented all of the steps above and are still not getting paid by your customers, it is only right to use the services of a professional Debt Collection Agency.

At Best4DebtCollection, we are committed to ensuring we find the right collection agency based on your requirements. Our recommendations are those that will only have your best interests at heart and share the same practice and ethics as ourselves.

All of the partners that we recommend are fully vetted and have extensive industry experience with recovering debts in the UK and across the globe.

It pays to choose the right Debt Collection Agency, and choosing the wrong company can be even worse than choosing none at all.

For Commercial Debt Collection requirements, we recommend Federal Management.

For Private Debt Collection Requirements, we recommend Frontline Collections.

For International Debt Collection Requirements, we recommend FM: International.

Top 5 Business Credit Control Tips for 2021

Get the Best4 Debt Collection Quotes Now

The hassle-free way to compare debt collection quotes from the best agencies and collectors in the UK right away

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