Credit Control – Resolve Your Cashflow Woes

Why bother? 

It doesn’t feel great to deliver on-time and with excellence, send the invoice and then not get paid. Chasing late invoices isn’t high on your list of fun things to do. But late payment reality in business, with Australian businesses paying 26.4 days overdue on average (according to one survey), making Australia the worst country in the world for unpaid invoices [1]. 

Not only is spending valuable on chasing payment annoying, it can actually impact your cashflow quite significantly. Knowing that around 80% of businesses fail due to cashflow problems, you don’t have to be whizz to realize the domino effect of poor credit control can really undermine your business if you don’t have the right credit control structures in place. The point? Good credit control equals cashflow, and bad credit control can send you broke. 

Good vs bad practice

Good credit control practice largely centers around a balancing act of being firm enough to get paid versus being too firm and damaging the relationship with the customer. While every customer relationship is different, you can go a long way to achieving this balance in the future with solid credit control protocols and policies.

Here are a few ways to improve your credit control policy to ensure you reduce the amount of unpaid invoices and reduce the wasted resources chasing them up.

  1. Tighten up your Credit Approval Application
    Clearly communicate the details of payments through a credit approval application. This document will make any future action many times easier should the client fail to pay on time. It should include;

    • Business Details of customer, 
    • Clearly specify the credit limit extended to the customer.
    • Clearly state invoice due date cycle (e.g 21 days)
    • Clearly state any late fees, interest penalties and debt collection fees to be passed to customers in the event of non-payment. It should also include a timeline of what action will be taken and when. 
    • Applicant provides invoicing specs they require to pay future invoices.
  2. Do a credit check.
    Ensure you extend the right amount of credit to a customer. It’s a case by case basis, so a credit check is worth the effort. You don’t want customers who have a bad history of late payment, or worse – are showing signs of insolvency.

Search ASIC and ABR online. If it’s a sizable credit limit and poses a serious risk to your own business cashflow, maybe invest some money in getting a special report from one of the key credit check agencies (Veda Advantage, Dun and Bradstreet and the Tasmanian Collection service) to check court-related activity to ensure the business has a healthy credit rating.

What about existing unpaid invoices?

It’s likely you’re reading this with an urgent need to get paid. Talking about preventing the problem in the future is great, but what about resolving the current overdue accounts? In order to protect customer relationships, it is standard industry practice to ensure the person collection is not the person who made the sale. If you’re part of an SMB, or even an account manager in a larger organization, outsourcing your collection to another department or entity not only protects your customer experience ratings, but also frees up your time to do what you do best.  

If you’re tired of chasing the same accounts creating cashflow problems, our credit control specialists have a proven record of recovering unpaid invoices. Unlike a debt collection agency, our credit recovery team acts on behalf of your company to negotiate terms of repayment and preserve your customer relationships. We effectively become your accounts team for certain clients, and ensure you get paid and ensure your client is afforded firm but professional courtesy

So let’s work together! Talk with our Business Improvement Partner Dean Vane or our Credit Control specialist Caroline Talley or your usual partner to discuss how we can help you get paid!


Dean Vane:   

Caroline Talley:




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