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- Higher Credit Limits
- Establishing Credit Limits
- Setting Credit Limits
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- The Five Cs of Credit Analysis
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- Code of Ethics
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- Customer Credit File; Credit File
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- Customer Purchase Orders, Errors on POs and their Impact on Collections
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- Enterprise Resource Planning
- Ethics for the Credit Manager
- Evaluating Financial Health
- Exchange of Credit Information
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- Internet as a Source of Credit Information
- Late Charges
- Minimum First Order Without Credit Investigation
- New Account Checklist
- Non-Disclosure Agreement
- Open Account Sales; Open Account Terms; Extension of Credit on Open Account Terms
- Order Approval; Order Hold; Credit Reviews; Pending Order Review
- Order Controls / Order Approval
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- Requesting Financial Information from Customers
- Restrictive Endorsements
- Returned Checks
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- Root Cause Analysis of Past Due Balances
- Safeguarding Accounts
- Security Agreements; Secured Debts
- Seller's Invoice
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- Terms of Sale
- Terms of Sale: Examples
- Types of Credit: Consumer Credit; Bank Credit; Commercial Credit; B2B; Business to Business
- Written Credit Policy Manual
- Handling Post Audit Claims More Effectively; Post Audit Claims
- Do's and Don'ts of Business to Business Debt Collection, Debt Collection Practices
- Bad Debt Reserves
- Advantages and Disadvantages of Purchasing Credit Insurance
- A Letter of Introduction
- Addressing Chronic Slow Pay Customers
- More about Cash Forecasting
- Streamlining Order Processing
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Setting Credit Limits
Customer credit limits are normally set high enough to accommodate the customer’s normal requirements, but low enough that credit risk can be properly managed. Orders for moderate risk accounts will be referred to the credit department for approval when the credit limit is exceeded or when the account is past due. For most creditors, a small number of customers will be classified as high risk.
High-risk accounts are identified by a number of factors or indicators including poor financial performance, poor payment history, tax liens, a previous bankruptcy, or a history of slow payments.
© 2010 by Michael C. Dennis. All Rights Reserved.