It's a classic mistake for business owners. They start a business that is focused on their product and not on the credit end of their business.
Luckily, a popular new book by Michelle Dunn makes it easy to solve this problem. The book, Become the Squeaky wheel, outlines different types of credit policies that business owners can use to create a customer-friendly credit policy. The goal is to have more customers who pay on time which translates to higher or more sales.
"You have a lot of different people with a lot of different needs, depending on your business," explains Dunn. "The first step is a customer friendly credit policy that ensures you have the information you need if there is ever a payment problem but also one that doesn't scare away your customers."
"It is important that you maintain customer relations but also protect yourself and your business from bad debt, bad checks or slow or non-paying customers," says Dunn.
The second step is to have the policy in effect before obtaining the new customer and making sure everyone in your organization is familiar with it and enforces it. It is not very professional to search for a credit application or not know which forms they have to fill out to open a new account.
If you find your credit application is not working for you or you are having problems with some aspect of your credit policy, you can change it at any time and measure your results to be sure they are working for you.
"The best strategy for making your credit policy work is to look at your bottom line and also ask your customers," explains Michelle Dunn. "Ask your customers if they had any problems with the forms or the information they had to provide, and keep asking.
About the Author
Michelle Dunn has over 17 years experience in credit and debt collection. She is the founder of Never Dunn Publishing, LLC, is a writer, consultant and the Editorial Advisor for Eli Financial Debt Collection Compliance Alert Newsletter. Michelle started M.A.D. Collection Agency and ran is successfully for 7 years. She also owns and runs Credit & Collections.com an online community for credit and business professionals. She has written 5 books