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How Are Your Customers Doing?

Your Virtual Credit Manager

This company was fortunate to avoid significant bad debt loss until Ames Department Stores, Kmart, and Fleming Foods (a distributor) all filed bankruptcy within the same year. Bad debt losses were understandably huge. Your Virtual Credit Manager is a reader-supported publication.

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Tackling Customers that Always Pay Late

Your Virtual Credit Manager

This creates cash flow shortages, an increased risk of bad debt, and a significant work requirement to mitigate the impact of late payments. As an alternative to credit cards, you might also work with a lender who will provide invoice financing to your low-volume accounts. That requires a balancing act.

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Storm Warning: Private Company Red Flags

Your Virtual Credit Manager

The Customer Delinquency Challenge Successful accounts receivable (AR) management involves minimizing past due balances to ensure steady cash in-flows and limit bad debt losses. Customer defaults can be devastating , especially when they cause a substantial bad debt loss. Do you need help improving cash flow?

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Gain Leverage Over Slow Paying and Risky Customers by Holding Up Their Orders

Your Virtual Credit Manager

Meanwhile, customers who previously were approved during your initial credit evaluation may become past due, max out their credit limit, or, worse yet, be in a deteriorating financial situation, all of which become even more likely when the economy is volatile—the result: cash flow problems and more exposure to bad debt losses.

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Are Your Credit & Collection Policies Aligned with Company Goals?

Your Virtual Credit Manager

When sales and production goals are set, and then the budget formalized, scant consideration is given to the impact on credit policy. In most companies, sales are given a strong priority over the risk of slow payments and bad debts regardless of gross margins and the resources the credit and collection function can provide to mitigate risk.

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Big Company Red Flags You Can't Afford to Miss

Your Virtual Credit Manager

If you are not on the lookout for customer red flags, especially those raised by public firms and other large enterprises, you will be at increased risk for incurring bad debt losses. Your Virtual Credit Manager is a reader-supported publication. Register Do you need help improving cash flow?

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Top 10 Strategies for Reducing Days Sales Outstanding (DSO)

Your Virtual Credit Manager

Your Virtual Credit Manager is a reader-supported publication. Besides driving process improvement, the experts at Your Virtual Credit Manager can apply default risk probabilities & other financial benchmarks to your AR portfolio to reveal actionable credit & collection insights.