The analysis of customer is often referred to as "human, thing, money" in Japan. In foreign countries, it is called 5 C's of Credit.
Character (Characteristics of the company)
It is the analysis of the competitiveness and market penetration of products and services, the managerial ability and background of representatives, bankruptcy history, etc., as well as the characteristic features of a company such as business history, type of industry and number of employees.
Capacity (Capacity to pay)
Analysis of short-term solvency. In overseas, since payment information can be obtained, the capacity to pay is judged by analysing payment information and collection agency history.
Capital (Capital strength)
Examine the adequacy of capital. It is also an analysis of long-term solvency. Of course, it is a matter of top priority to check whether the company has fallen into excess debt or not.
Collateral (Collateral strength)
Examine how many assets are there for collateral. Depending on the country, the credit report describes the status of collateral status. Check creditors, amount of debt, collateral property, etc.
Conditions (Economic condition)
Analyse the macroeconomics and the economic situation surrounding customers. It is necessary to understand not the only country risk but also business trends in the industry.
Collecting and analysing information from customers with an awareness of 5C's of Credit eliminates leakage and reduces the possibility of missing the whole picture.