Do you know your customer´s payment behaviour and trends?
Today more than ever, small to mid-size companies need to be proactive in protecting their very important credit asset. In this still fragile economy and UK businesses owed £31.3bn in late payments credit scores and indexes can be the difference between a company's ability to fail or succeed and to grow and prosper. As with consumer scores, business credit scores play a big part in determining whether financing of all types will be approved.
The right business credit score is of great value when negotiating lower lease payments, approval for business loans/equipment or when a potential client picks a company for business-to-business (B2B) services.
Credit challenges can come in many forms. The sad fact is one late payment on the wrong account or a collection account for a specific debt listed on the businesses report can drop a score by 40 plus points. This will immediately place a company into the high risk category.
As a business, one of the most important scores is your Payment Score. Knowing what this number is and having the ability to increase it can mean acquiring the financing needed to start or grow your business. It reflects your payment record and having a strong Payment Score can help give you access to credit lines for your marketing effort, buying or leasing needed equipment, and getting the supplies required to land bigger clients and higher revenues. Obviously if the score is low the opposite will occur.
Using a business credit profile on a potential service provider can give a company the edge it needs to decide who will gain their account and provide better quality and more consistent stable services. With a view into the pay history of a potential service provider, credit holder, or loan applicant over a 12 month period, a business will be able to see great fluctuations in score which may signify poor financial health and management. Just having a great score today may not be enough to get the financial tools or new accounts needed. When a company shows continuous stability of positive scores over a long period it reflects skill and success to the viewer. Keeping great credit scores could deliver the account when competing with other companies for approval on a bid.
If a company is fortunate enough to be approved for financing while having inconsistent and fluctuating credit scores, the interest or fees associated with the financing/credit may be at much higher costs. Today many businesses, whether small or large, are being judged and hired based on their pattern of payment experience over the past year or more. Those who are wise are pursuing avenues for protecting their credit asset to insure maximum opportunity.
Changes in payment performance constitutes one of the earliest signals of possible financial difficulty and represents one of the most predictive elements of the likelihood of failure before the filing of official documentation such as a balance sheet.
Payment performance trends represent an exclusive insight into the trading performance of a business. Credit Assist collects hundreds of millions of trade payment experiences on a monthly basis from companies operating in a broad variety of commercial sectors in order to analyse the payment performance of companies. The results of this analysis are represented by the Credit Assist Payment Score which reflects how the subject company pays its bills.
If you need to be kept up to date of your UK or International client’s payment performance score why not contact us today. We can monitor this for you in 38 countries around the world 24/7. Contact firstname.lastname@example.org or call 01604 217333