Managing your relationship with your customer from the start of your dealings with them can help
reduce write offs.
Successful businesses that survive the tough times and thrive in the good times have robust
processes. They will start with a prospect check before beating a sales path to the door of their
new prospective customer. What do we mean by this? Well, let’s say a sales representative has 50
prospects he would like to approach there is little point in him spending two weeks chasing one
or more only to find out that they don’t pass the company policy on account opening. A quick ‘prospect check’ can save much time and it will indicate whether that prospect is the next golden customer or a potential liability.
When the sales person does come to opening an account on credit the data they collect before
the sale is processed is also crucial. Therefore having a comprehensive credit account application
form (with distinctly separate ones for limited companies, sole traders and partnerships)
that asks the right questions will help should problems arise in the future. And finally periodic checks to see that the customer is still worthy of the credit limits you have set. Do not rely on your initial checks alone as customers can run into trouble on a regular basis
Once again my grateful thanks to Ken Brown of Accountassyst.com for his provision of these 7 deadly sins.