After the credit policy has been written, it’s important to have a two-way dialogue between the credit control and sales teams. Sales needs a full understanding of what factors are in the credit policy and why certain factors would result in a deal rejection. And the finance team needs to see that the sales team is using the credit policy at the start of the sales process to prevent getting stuck with late paying customers, which ends up costing more in the long run.
This is something Matthew Debbage, our CEO of the Americas and Asia, has seen happen often in companies. So, he has some good tips on how to get both teams working better together. As he explains, “The finance team needs to take ownership of not just creating a credit policy but also documenting it, sharing it and hosting interactive sessions with the sales team to help them understand what’s included in the credit policy - the factors they consider, the reasons those factors are deemed high risk and why those factors could hurt their earning potential and ability to close deals.
This doesn’t mean the sales team has no responsibility in this matter. Once they’ve been informed of and trained on the credit policy, they need to make sure they’re looking at the necessary financial data early on. And if they don’t have this type of data available, then they need to push their sales leader or technology leader to bring on the right tools or integrate with a platform that has credit risk data.”