An efficient credit control system is an important element of any business – no matter how big or small. There can be a number of reasons why an invoice hasn’t been paid. Chasing overdue invoices promptly can pick up issues and reduce the impact on your cash flow.
We work for a number of organisations who outsource their credit control, enabling them to concentrate on other areas of the business. Having the time and manpower to carry out credit management effectively can be hard.
Here we look at the benefits of outsourcing your credit control and how we can help.
Find the right contact
The invoice might have been sent to your key contact, but that won’t necessarily be the person in charge of paying. If the invoice hasn’t been forwarded onto the accounts departments it can be left unpaid.
Settle any issues
Often you need to chase overdue invoices because of a simple problem that can quickly be resolved. For instance, when you finally get around to chasing an invoice, the customer brings up a dispute. This then gives them longer to pay and can impact your cash flow. The more customers that pay invoices late, the worse your financial situation can become.
Increase your cash flow
By collecting your unpaid invoices sooner, you can improve the business’ cash flow. It’s impossible to run a company smoothly and efficiently if you’ve got money outstanding and you don’t know when it’s coming in. With a third-party credit control process, money can be in your account sooner and you spend less time chasing.
An effective process
With a strict procedure in place and processes to follow, the system becomes more efficient. Customers become used to it and may start proactively paying on time.
By outsourcing your commercial debt recovery, you can deploy your staff into other areas of the business. This makes them more productive and takes away the stress of chasing your customers. A dedicated external credit control team can be an enormous benefit to your company.
One of the concerns businesses often have about chasing unpaid invoices is the breakdown of client relationships. It can be frustrating recovering debts, which can present a challenge when talking to customers. By using a third-party debt recovery company, you can maintain the relationship and keep them as a customer. We act in a professional manner at all times and try to come to an arrangement with the debtor, without using threatening behaviour.
Prevent further debts
One of the advantages of an effective credit control system is that customers don’t build up large debts. Where a credit account is getting particularly high, we can make them a priority to recover and ensure there are no serious financial problems. If you leave it too late there’s a risk that the company could go into administration.