www.creditorwatch.com.au should be your first step in your process for extending credit to your customers.
Why I hear you ask?
ASIC has identified a serious increase in the number of companies going into administration. Why not be ahead of the game and monitor your business money better.
Ask yourself these questions:
Would you extend credit to a customer if you were aware of their credit risk?
Would you risk your business to help that customer if they were a credit risk?
Creditorwatch keeps an eye on your customers for you, you will be sent an alert if there is a change in their credit status.
Recommendations:
1. Before you take on a new customer, perform a free credit check to know their credit worthiness.
2. If you decide to extend credit then provide them with a manageable credit limit in the beginning.
3. Continue to monitor all your customers for changes. Through Creditorwatch you will be able to react sooner rather than later on the credit that you extend to your customers.
4. Put a process in place for collecting payments. You can do this manually through a diary or you can use an automated product that syncs with most accounting softwares.
5. Notes, Notes, Notes as you can see I can’t stress this enough. You need to keep track of your communication process with all your customers. This helps if you have to go to debt recovery on your customers.
6. If you are struggling to get payment out of a customer, send them a final notice letter outlining your next steps including registering a default. Creditorwatch has some tools that you can use for this.
IF YOU HAVE ANY FURTHER QUESTIONS IN REGARDS TO DEALING WITH YOUR DEBTORS PLEASE CALL ME TO DISCUSS.
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