5 Biggest Credit Control Mistakes


When the cash stops circulating, businesses – even profitable ones – die.
 
StubbsGazette identifies the Top 5 Most Common Credit Control Mistakes
 
1.       No Credit Controller
If you can’t look after Credit Control yourself, assign someone to the function as this will reduce the risk of having to write off bad debts.
2.       No Credit Limit set
Set credit limits for all customers. StubbsGazette Company Reports will always suggest a recommend a credit limit. You should adjust any credit limit to take account of the golden rule (never to give any single customer more credit than you could afford to lose if the customer became insolvent and was unable to pay) and your own payment experience.
3.       Unclear Credit Terms
Make sure every customer has signed up to your terms and conditions and is in no doubt over the agreed credit terms. Check the paperwork from the sales person and if anything is unclear and make it a priority to resolve before the goods are shipped or services provided.
4.       Delay in sending out invoices
Send invoices immediately after you have supplied the goods or service; don’t wait until the end of the month. Make a follow-up call to confirm that all the invoice details are correct and that there will be no problem paying it by the due date. If there are any queries over the order or the invoice notify sales immediately and actively engage them in the resolution process. Be aware that some companies will use invoice errors as a delay tactic.
5.       No  Strategy for dealing with late payers
Check late payments daily and chase them up on the day they become overdue, always starting with largest debtors first. Inform late payers that unless payment is received by an agreed date you will charge interest on the overdue amount. All businesses have a statutory right to charge interest on late payments, whether it is in their terms and conditions or not. Formalise any revised agreement in writing and confirm to your customer in writing that you will be exercising your statutory right to interest on overdue accounts. Key to success is making sure that overdue customers put payment of your invoice ahead of any other supplier who might be pressing for payment. If you haven’t been paid by 90 days use a debt collection agency. A good debt collection agency will normally embark on an amicable collection phase that will yield favourable results well before you incur any of the costs of going down the legal route.

Finally, if an order looks too good to be true, it almost certainly is.

Top Judgments Registered

11.11.2020

Urban Green Private Limited
Address: R/o Atkins Hall, River Towers, Lee Road, Cork
Amount: €734,547.90

10.11.2020

Thomas O'Brien
Address: Castlegrace, Clogheen, County Tipperary
Amount: €93,749.13

10.11.2020

Margaret O'Brien
Address: Castlegrace, Clogheen, County Tipperary
Amount: €87,979.01

06.11.2020

Sean Browne
Address: 24 Woodlands Avenue, Arklow, Co Wicklow
Amount: €38,094.60

Limited Company Notices

18.11.2020

ESERAM MEDICAL LIMITED
Resolved 17 November 2020 that the above named com...
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18.11.2020

NIPPON RELAXATION COMPANY LIMITED
Resolved 17 November 2020 that the above named com...
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18.11.2020

PEONIEMILL LIMITED
Resolved 24/12/20 that the above named company be ...
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18.11.2020

RE FINANCING HOLDCO LIMITED
Resolved 24/12/20 that the above named company be ...
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