So, you’re an accountant and you’ve been asked to start up a credit control department by your clients - but how do you go about doing that? The itsettled team is here to help.
First though, why not consider itsettled? We provide an automated credit control software to businesses and accountants. Our software collects your invoices faster and improves your cashflow. This can reduce the risk to your business, and of course leaves you as an accountant more time to spend on higher-value tasks.
First up, it’s vital to decide exactly what you’re going to offer as part of your Credit Control department. You may want to leave everything entirely to an automated solution, or you may decide to do it all yourself - but you need to know what your Credit Control department is going to offer. Are you going to offer credit control services but use a third party to do the chasing portions, or are you going to do everything yourself? Once you’ve decided this you can move on to the next step.
If you’re doing the credit control yourself you’ll need to decide on timings and other details that you’ll use within your Credit Control department. Make sure that you write out a structure for when you’ll chase people for overdue invoices - don’t just do it whenever you feel like it - write a structure for yourself and your department and stick to it. This set process will help maintain customer relationships for your clients too.
Once you’ve decided on the exact procedure you’ll follow within your Credit Control department, you can then proceed to the pricing. You could offer a tiered pricing system, with the higher tiers offering debt chasing and legal fees et cetera. You may also want to offer an introductory discount when you launch the department.
One common concern that business owners have when introduced to a new process, especially one covering credit control, is how it will affect their customers. If the customers become unhappy, that can be pretty bad for the business. To avoid this, write a letter that your customers can send to their customers, warning them that a new payments process is about to be introduced. This way, their customers will know what to expect.
Now that you’ve set up your Credit Control Department, you can’t just leave it to run itself (unless you’re using itsettled of course). It’s best practice to check on your customers aged debtors frequently - even if they’re only paying you a few weeks late, that can add up. Create an aged debtor report for your clients once a quarter, so that they’re in the loop too.
Setting up a Credit Control department doesn’t have to be hard - you can use itsettled. Our automated cashflow and credit management software collects your clients invoices fast and improves their working capital position. Using itsettled will allow you to scale your firm, improve your clients cashflow position, and save valuable time for higher value tasks.
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