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

The credit crisis has claimed many jobs including top executives of leading financial companies including Citigroup and Merrill Lynch.  Now instead of the focus being on selling more and more it is on surviving and collecting from our customers more and more.

This might mean that you have to re-structure your credit policies and how you deal with credit and debt with your business and customers.  Many of us have to not only collect more from our customers, we have to cut costs and re-group to survive as things only get worse.  Even though you are trying to save money, spending money on a quality credit manager or collection training could be very beneficial to your business and your bottom line as the economy falters.

One thing to remember as you re-work your credit policies is that right now, at the same time, everyone else is doing the same thing. Everyone is feeling the pain and needs to take action – the demand for high quality collectors is going through the roof.  If you had a credit policy in place BEFORE these tough times, you are in a much better position than the thousands of business owners who run their business without any type of credit polices or procedures in place.  Those companies are now scrambling to figure out how to implement a policy.  They have something stacked against them in this case, preventive maintenance with a credit policy can make or break a business.  Sometimes it can really be too late to recover.

Some things to look for while you restructure your policies include lessons learned, oversights, team-building, risk management, and cost-containment.  Other things you can do to improve your situation include having outstanding customer service, networking and collaboration within your industry.