Remove Bad Debt Remove Deductions Remove Default
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How Are Your Customers Doing?

Your Virtual Credit Manager

Based on this industry outlook, there was staff performing collections and deduction resolution, but no credit function. 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.

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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. In contrast, customer bankruptcies or other defaults typically cause the loss of most, if not all, the AR owed. Do you need help improving cash flow?

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Sales Commissions Impact the Collection Process

Your Virtual Credit Manager

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!

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Are Your Customers as Profitable as You Think?

Your Virtual Credit Manager

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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Are You In Control of Your Receivables?

Your Virtual Credit Manager

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.

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Should You Outsource AR Management?

Your Virtual Credit Manager

. “First party” means routine collection contact for slight to medium delinquency account verses their usual highly escalated, urgent (third party) collection of very aged AR in danger of default. to minimize the chance of bad debt loss. Compare the cost of outsourcing to the full cost of using internal resources.

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Is Your O2C Process Optimized for Superior AR Performance?

Your Virtual Credit Manager

Pricing Problems: A supplier of medical devices implemented a new ERP system, but flaws in the pricing application caused it to frequently default to list price (nearly every accounts had exceptions), thereby generating hundreds of incorrect invoices. Investigating and resolving deductions alone is much too costly.