In a recent article we discussed what a credit and collections policy is and the importance of not only having a policy, but making sure it is updated regularly. In this article we will discuss what should be included for a complete and effective document. Your credit and collections policy can be as in depth or as brief as you would like, but keep in mind that even the most basic policy should help a company answer the following questions:
- What is the purpose of the policy?
- What are the goals of the credit department?
- How will those goals be measured?
- Who is responsible for what?
- What is the credit evaluation process?
- What is the collections process?
As you work through to build each section of your policy be sure to answer the above questions to help guide your sales and collections department. A solid credit policy will include the following sections: Continue reading