A Credit Manager is a challenging career choice and a very important role within a company; with money being the blood stem of every business, a Credit Manager needs to protect it and make wise decisions that will benefit the business in both the short and long term. A Credit Manager’s role will include being responsible for the entire credit granting process, consistent application of a credit policy, regular reviews of existing customers and the assessment of potential customers. They have a consistent goal of keeping a solid and healthy cash flow running through the business and optimising the mix of company sales and bad debt losses. Have you ever wondered what a company looks for when they are debating whether or not to go into business with you? Do you know what things their Credit Managers check? How they find out information? We sat down with a Credit Manager and managed to retrieve their deepest, darkest secrets of the trade! This is what they had to say…
We check your company credit report. As a credit report is the detailed financial portfolio of your business, one of the first things we do is check it if we are thinking to go into business with you. We check it to see your credit rating, your credit limits and most importantly your payment behaviour. We make sure that you are able to pay us on time, in the full amount and consistently. If you don’t come up to our standards on your credit report, we won’t be doing business. We can see details such as your turnover, your operating profits, wages and what mortgages you have. We will undergo a detailed analysis of your credit report if we are going to go into business with you.
We Google you. If we are unsure of who you are, never heard of you or find you a little suspicious; we will Google you. Not only that, we will check your company out on Yell, LinkedIn and Google maps. If you don’t pay us on time, we will Google you for any previous customer reviews about you and check Google maps to see if you are in a legitimate office.
Credit score is important to us, especially for monitoring customers. Your credit score is basically the front door of your business hub. It gives a rating of the business as a whole. If we don’t regularly check your credit report thoroughly but just keep an eye on the basics and you are still consistently paying us, we wouldn’t have any cause for concern. However if we see your credit rating has dropped, it will prompt us to check your report for something that has changed. This allows us to be ahead of the game if your payments to us start to become late. This then allows us to forecast our cashflow to handle this delay if we decide to keep doing business with you.
Being a late payer is the worst trait you could have as a business. When we check your credit report we will be checking your payment behaviour, and a bad payment trend is the biggest warning sign you could give us to not work with you. If you are a consistent late payer and your days beyond terms are too large for us we wouldn’t do business. However if you are ‘in the green’ at the moment, but your payment trend suggests you are getting later and later at paying your bills, this would discourage us from working with you. If we detect a chance that you could affect our own bills and disrupting our cash flow based on your payment behaviour we are more than likely going to steer clear of your company. As a Credit Manager protecting a business’s financials, we wouldn’t knowingly let the business get into a situation where our cash flow could be disrupted.
Top three warning signs
Your website or phone line is down. If we can’t get hold of someone to speak to and discuss our business, that is the first red flag on our radar.
We can’t find you on Google maps, or your address you listed and the property you reside in doesn’t match up. If you have told us you are a multi-million pound company and we search you on Google maps to find your address at a porter cabin, we would raise concern and question you.
You’re not registered. We use credit reporting to view companies’ credit reports and see how their financials are before going into business with them. If we can’t find your company on there or there is barely any information on your report, this will seem suspicious to us. It’s always best to give all your information to official sources such as Companies House as this allows credit checking agencies to then give you the best accurate score they can give you as they have all your information to base it on.
So there are our confessions of a Credit Manager. If you are worried about what a Credit Manager would think of your company when you approach theirs to do business with, see our blog post on how to make your business more financially attractive.