Auditel Consultant:
Stephen Gaubert

Do you Credit Check your Clients?

04 Feb 2010 | Filed under: Cost Management, Cost Reduction, Credit checking

The majority of Small and Medium Enterprises (SMEs) do not credit check their clients at a time when cash is really king. Research shows that only 25% of SMEs carry out credit checks on their clients or companies that they are doing business with.

In the current climate SMEs are more vulnerable to late payment or indeed no payment. One third of SMEs surveyed mentioned cash flow problems and late payments were the main reasons for the problems experienced.

Tips to assist Credit Checking
* Carry out regular credit checks on your clients and companies that you do business with
* Assign a credit limit and do not exceed this
* Agree payment terms within a certain number of days and chase up late payment quickly. If you have carried out the work why should you have to wait for payment?

Finally, if the client is not paying on time, then there are a number of suppliers who will manage the invoice chasing process on a performance fee basis, without the need for factoring.

If you wish to explore the most cost effective service in credit checking your clients and companies that you do business with then contact Stephen Gaubert – call 020 8482 1370 or 07785 340 280, email stephen.gaubert@auditel.co.uk or visit www.auditel.co.uk/stephengaubert