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Credit management and the covid have been inextricably linked since March 2020. The lockdown, quarantine measures and remote working are not only having a major impact on you, but also on your clients. So what can you do to minimise that impact? Below are some tips you can use to corona-proof your credit management.
Tip 1: Work in a way that suits your client.
Some clients prefer to receiving invoices by post. Normally, that’s not a problem, but due to the rules on working from home, this can now cause big delays. Have you noticed a client taking longer than usual to pay your invoices? Perhaps the delay is being caused by a newly implemented work-from-home policy. Contact the client and find out their preferred invoicing channel, then adjust accordingly (temporarily or otherwise). Who knows, maybe your client will get a taste for digital invoicing!
Tip 2: Customise your approach even more.
There’s nothing more annoying than being unable to contact a client who has an outstanding invoice. But keep in mind that there are many reasons your client might be inaccessible, especially these days. Perhaps your contact has fallen ill, is in quarantine or is fully or partly technically unemployed along with other colleagues. So don’t be too hasty to send reminders. First check whether there is a specific reason for the delay. For example, take a look at the client’s website, social media channels or other communication channels. Then you can look for solutions. Personal contact and an empathetic approach are very important.
Tip 3: Keep your finger on the pulse.
The coronavirus crisis is having a major impact on both companies and individuals. Clients who are having difficulties paying their bills might be hesitant to let you know, resulting in growing arrears. Here, strong risk management can offer some relief. Identify those clients who are paying late for the first time or whose credit score has suddenly dropped sharply. Approach them proactively and, where possible, suggest a payment plan and/or more flexible payment terms. Important: keep an eye on your own liquidity!
Tip 4: Make it easy to pay.
Whereas some clients have less work or none at all due to the coronavirus, others are overwhelmed by all the extra work. For example, you can imagine that it must be all hands on deck at the National Employment Office (ONEM), health insurance organisations and certain retail companies. The result? An e-mail inbox bursting at the seams and telephones ringing off the hook. There is a good chance your client will overlook one or more invoices. Here, too, an empathetic approach is important. After all, these are unusual times for everyone. Make your e-mails stand out from the rest and make it easy for your client to pay. A personalised layout and the inclusion of payment partners will immediately make a big difference.
Tip 5: Don’t forget to allow for cancellations.
Those clients most impacted by the coronavirus crisis are sometimes forced to cancel order(s). Sit down with the client (virtually) and try to find a solution that is realistic for both parties. If that doesn’t work bring in a mediator. In some countries, the costs of mediation are even reimbursed by the government due to the coronavirus crisis. But if you’re faced with more unpaid invoices and cancellations than anticipated, you must take steps to protect your cash flow. For example with On Demand Financing.
Want to find out more about how you can further optimise your credit management? Then contact us now at info@icontroller.eu.
