Mohamed RAMZI in Credit Management, Economists and Finance, credit control Treasury • TDM Oct 9, 2019 · 1 min read · 4.6K

The Basics of Credit Control - The 8 Steps to look out for : 1- Taking / receiving a new order.

The Basics of Credit Control - The 8 Steps to look out for : 1- Taking / receiving a new order.Golden Rule: "Know your customers process and make them know yours".


When you're receiving a new order from an existing customer or from a new one, you must ensure the 7 following points:


1 - Agreeing payment terms with your client: Discuss with not only all new clients / Customers but also your suppliers.


2 - Discuss with customers the credit term (due date), the credit limit (amount), payments methods…


3 - You should also include your right to make late payment and interest charges.


4 - Your client / customer should be asked to sign and date your terms & conditions.

Do not be afraid to push for all the information you need; if you don’t get it now, It will be far harder latter.


5 - Make a “Client Folder” and try to have all answers to the following questions: Who do What? When? And How?

- Orders: Who make orders? When: Frequency of Orders, How: by Mail, by Fax, by Phone…

- Reception of delivery: Who receive? When: Time & frequency, How and Where: quantity, verification, documentation…

- Invoices: Who must receive Bills? Optimal frequency and best time for receiving invoices? ....

- Payments: Who have the responsibility to make payments? Who verify, approve or sign them? When: monthly, quarterly, end or beginning of period, number of times in the same period…


6 - Write a Credit Policy that you and all your employees should follow.


7 - Credit Policy must include all exceptions: who can make hold or authorization of credit? When? And How?

Try and pre-empt any misunderstandings that might arise and make sure the client knows exactly what to expect.


M. RAMZI