10 Ways a Bookkeeper Can Improve Your Credit Control

By Jane E. Kelly, Paul Barrow, Lita Epstein

Following are ten ways to help you improve your credit control within your business to ensure that the cash keeps rolling in! Everyone knows that it’s important to get cash flowing into a business as quickly as possible. It’s the life blood of your business.

  • Make sure your sales invoices are issued promptly. As soon as they’re created, email them to the customer because it’s the fastest delivery system.

  • Use a Pay Now button on your invoice. If you have an online accounting software package, you may be able to apply links to your invoices so that customers and suppliers can pay electronically. At the very least, make sure your bank details are clearly displayed on your invoices.

  • Follow a strict credit control procedure. Make sure all staff are fully aware of the procedure for chasing debts and the order in which events need to occur.

  • Offer a discount for early payment. Customers may choose to pay earlier if doing so means they can benefit from a reduced price.

  • Ensure products or services are of the highest standard. Doing so means that you minimise the possibility of disputes resulting in customers failing to pay invoices on time.

  • Email statements to customers on a timely basis. This approach politely reminds customers that they have an outstanding debt, and hopefully encourages them to pay sooner rather than later. It also gives the credit controller a chance to monitor the business’s debts regularly.

  • Keep your banking up to date. Make regular payments into your accounts and regularly reconcile those accounts. Staying on top of your banking means that Aged Debtor reports, for example, will be as accurate as they possibly can be.

  • Ensure that your payment terms are clear and effectively communicated to your customers. At the very least, display your terms and conditions on your invoices.

  • Monitor credit limits regularly. Establish the maximum amount of debt that a customer can accrue and keep a very close eye on it. If a customer exceeds that agreed limit, it may be an indicator of future non-payment problems.

  • Establish a procedure for dealing with customer disputes and ensure that all staff are aware of it. Solving disputes efficiently and promptly can minimise the effect on payments.