If someone changes their payment pattern, or even their ordering pattern suddenly, they may be a financial risk.

Whilst you can avoid all risk, follow up and regular credit checking are the two most effective methods to reduce your risk of delinquent payers.

Look for the signs and this may help you identify potential risks:

• Managerial changes within an organisation.
  If a company is experiencing difficulties sometimes senior management will change to accommodate improvements within the organisations sales and trading habits.
• Cheques may be dishonoured – a sure fire way of knowing cashflow is stretched or non-existent. Some organisations change banks – regularly.
• Payment methods can change dramatically. When payments were once made by direct credit and are now paid by cheque or credit card, suggests a financial problem.
• If previously your terms and conditions were all complied with, but now payments are staggered and slow, your Customer may be struggling.
• Changes to address and phone numbers.
  Watch for signs of companies downsizing and/or moving premises. They may not be able to pay their lease or they may be trying to avoid Creditors.
• Changes to trading names.
  Watch for companies who change their branding and/or company names. This could be a sign that they are closing one trading entity to start another to defraud Creditors.
• Get your Sales team to visit your Customers.
  They can get a first-hand account of how the business appears to be trading.
• Disputed accounts allow your Customer to buy some time for payment.
  Make sure your ordering and invoicing is 100% error-free to prevent any reason for late or non-payment.
• Communicate and get an insight to the issues your Customer is facing.
  You may be able to extend a longer credit period for a short term. They will thank you for assisting their business to achieve so that both parties continue to trade.

If all else fails, call the experts. We are happy to help enhance your business processes.