Credit Policy for businesses and how to extend credit and manage credit risk

When you create your csutomized credit policy for your business, are you asking yoruself these questions:

• Have you diversified yoru customer base?
• Are you relying on any one large customer for most of your cash flow?
• have you included legal wording in your contract to avoid collection problems?
• Do you review credit applications?
• have you outlined when a client relationship must be severed because of bad debt?
• Have you trained your credit manager in customer service?

You must ask yourself these questions to help you create a streamlined, effective credit policy that will work.