Risky Business!

Any transaction that involves giving credit must also involve the taking of a certain amount of risk. The risk is impossible to eliminate but it can be greatly reduced by the introduction of a credit management policy and a systematic collection cycle. Whilst employing such methods flexibility must exist to allow for the exceptions that will occur from time to time. Consideration to a number of points must be exercised when forming a policy, particularly in relation to debtors who have historically good payment records. Other factors involve assessing future sales potentials, settlement terms being offered by your close competitors and any special considerations that exist in your particular industry