Bad Debt Deductions Default 
Your Virtual Credit Manager
OCTOBER 17, 2023
Not being paid in full or in part causes a bad debt loss. The first step is to estimate how much bad debt loss you can absorb as a percentage of sales in a year. Conversely, if the profit margin is low, bad debt losses will have a much greater impact, and credit controls will have to be tighter.
Your Virtual Credit Manager
DECEMBER 20, 2022
All these bad customer behaviors are a drain on your profit. Buy Credit Reports Managing Credit In-house Your other option is to assess, monitor and control the bad debt exposure yourself. Companies usually have a Top 10 or Top 20 customer list. Often these are ranked solely by the volume of sales.
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Your Virtual Credit Manager
NOVEMBER 14, 2023
It affects the level of bad debt loss (uncollected Accounts Receivables) you suffer. Selling only to financially strong customers reduces the risk of bad debt loss, (and the cost of Credit and Collections activity required). The increased risk of a significant bad debt loss that your firm bears.
Your Virtual Credit Manager
JANUARY 17, 2023
There was a lot of gnashing of teeth on the part of the sales team at the beginning, but invoice accuracy improved in each subsequent month as sales began transmitting accurate pricing and terms to order processing, thereby reducing downstream disputes and payment deductions. it just might help them pay you sooner!
Your Virtual Credit Manager
SEPTEMBER 12, 2023
To make matters worse, invoice errors also tend to generate payment deductions (partial payments). Correcting invoices and reconciling payment deductions are essentially rework: work that is not necessary if you got it right the first time. To make matters worse, most payment posting errors will involve deductions.
Your Virtual Credit Manager
APRIL 11, 2023
Poor Credit Controls: Poor credit control practices can result in providing goods or services to high-risk accounts that are likely to pay beyond terms or even default on payments. Late or inconsistent follow-up on overdue accounts leads to longer payment cycles and increased bad debt write-offs. Business failures are the norm.
Your Virtual Credit Manager
JANUARY 10, 2023
Photo by Patrick Hendry on Unsplash Although defaults resulting in significant bad debt losses are a rare event for trade creditors, much of the focus of AR Management is on credit risk. While the impact of defaults can be severe, late payments are very common though their impact less visible.
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