CHAPTER 4: CREDIT MANAGEMENT
Once the account has been set up, another important role of the sales rep can be to help resolve discrepancies, since they have a relationship with the customer that is built on trust. If discrepancies are resolved quickly, often the payment can still be made on-time, or an invalid deduction can be repaid quickly. Another important aspect is what the credit manager can do for the sales rep. The credit manager should be looking for accounts that are paying their invoices on time, and maximizing their credit limits. The credit manager should request updated financials and analyze whether the customer’s credit limit could be raised so the sales rep can get more orders.
BEST PRACTICES
Mushroom producer South Mill Champs has built a solid relationship between AR and sales. Says Controller Steve Fulmer: “Communication is the first step; and that communication cannot be only when you are telling them which customers have not paid. Regular check-ins are a good idea, at least initially if the relationship has been strained. I think it is important to share information that they can use for example: Which customers are consistently paying on time or early. Which customers are being overly aggressive with their deductions. Changes in their credit reports. Follow your trade magazines or newsletters and point out any information or articles that involve a customer.”
At McKee Foods Corporation, AR and sales “have had meetings to discuss our views of processes. They have been helpful in showing that misunderstanding causes frustration. We are seeing more clearly where each department is coming from. We have a ways to go. There is hope,” stresses receivables administrator Valerie Phillips.
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THE ACCOUNTS RECEIVABLE SPECIALIST CERTIFICATION PROGRAM E-TEXTBOOK
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