Practitioner’s guide
to streamlining credit
management strategies
whilst exceeding customer
expectations
Customers are the most valuable assets of any organisation.
By managing your customers effectively and with the right action
at the right time, you can not only limit your exposure to bad debt
but increase profitability too.
If you wish to carry on a relationship with a customer, you need to spend time
understanding their payment and credit issues. If they are open and honest
about their situation and are committed to maintaining a relationship with
your company, their accounts can be handled appropriately. To make sure you
handle every customer in the right way, read our tips on taking control of your
credit management strategy.
Tip One:
Target higher risk customers to prioritise collections
• Get a good overview of all your customer accounts and find out who are your
riskiest customers. Once you know who is paying you the slowest or who has
stopped paying you altogether, you can begin prioritising your collections
strategy.
Remember:
Higher risk customers increase your bad debt exposure significantly
more than a customer who has missed one payment. By recognising a
one-off payment glitch from a more serious payment problem, you can
take appropriate action.
Tip Two:
Utilise different credit controllers
• If you are unable to retrieve payment using one contact switch the account
to another credit controller, a new contact will bring a different view of point
and style to the collections process that may be more successful.
Remember:
Changing your approach can help placate a frustrated customer who
feels like they are getting nowhere. Sometimes a different voice can
make an impact, so try switching from a female to male credit controller.
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Tip Three:
Play where you can win and learn from your mistakes
• When relationships become frayed and customers still show no sign of
paying it can sometimes be better to write off debt. Take key learnings about
the customer and your collections approach back to the team to ensure it
never happens again.
Remember:
Chasing someone who is never going to pay you is a drain on resources
that could be better spent chasing customers who can and will pay you.
Gain the respect of your team and the rest of the business by knowing
the difference between a win and a lost cause and by setting realistic
targets.
Tip Four:
Reinforce messages with action
• Threatening court action can have an effect on persistent late-paying
customers and can be a good way to encourage customers into making a
payment. This type of action could also put high risk customers off getting
credit from you.
Remember:
If your business gets a reputation for never seeing through to action,
customers and clients will become aware that court action is just another
empty threat. Unless you are consistent, you could build a reputation as
an easy company to not pay.
Tip Five:
Save money by strengthening existing customer relationships
• Manage your customers efficiently by renegotiating credit prices where
appropriate and by offering new products to customers who pay well. Better
credit management that is also intuitive to customer needs will deliver longterm profitability.
Remember:
Acquiring new customers is expensive and takes lots of time and
considerable resources. Strengthening your existing customer
relationships with better service levels and tailored credit management
will strengthen brand loyalty.
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United Kingdom
www.experian.co.uk/creditguides
0844 481 5627
The Guides in this series:
1. How to credit check new customers
2. How to reduce payment delays
3. How to improve relationships between credit sales teams
4. How to streamline collection strategies whilst exceeding
customer expectations
5. How to review credit limits for existing business customers and improve
your negotiation skills
For help and advice on best practice in credit management,
call Experian on 0844 481 5627
or email business.information@uk.experian.com
or visit www.experian.co.uk/creditguides
About Experian
Experian are the industry experts in customer credit, marketing and business
data. Our products are specifically designed to help you make the most out of
your potential and current customer base.
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