Improving Credit Management and Debt Collection

5 Day Training

Dates: 16 – 20 September | 11 – 15 November 2024

Locations: Grayston Ridge Office Park, Sandton

Platform: Available In-Class / Online

Price: Available on request

Course Introduction

Collecting money is an integral part of any business operation. Timely collections are crucial for maintaining healthy cash flow, reducing the need for bank borrowing, minimizing bad debts, and maximizing profits. Effective credit management involves complex skills, requiring professionals to be exceptional communicators who can represent the company while balancing sales and finance interests. Prospen Africa’s Improving Credit Management and Debt Collection course aims to equip you with the necessary skills to enhance successful cash collection, make commercially savvy credit decisions, maximize sales, manage risks, and contribute to overall profitability.

Course Objectives

This 4-day Improving Credit Management and Debt Collection course is designed to help you identify potential debtors, implement preventive measures, establish effective credit policies, conduct accurate credit evaluations, and reduce exposure. Our experienced and qualified credit management expert will share valuable insights and case studies, covering the following topics:

Effective credit management and control policies
Techniques for credit evaluation and risk assessment
Establishing a national database of consumer and commercial credit information
Practical debt collection strategies
Collaboration with reputable collection agencies
Methods for reducing overdue accounts and measuring credit performance
Legal aspects of debt recovery, obtaining judgments, and enforcing them
Negotiating out-of-court settlements

Who should attend?

This seminar is suitable for Financial Directors, Management Accountants, State Accountants, Financial Accountants, Chief Financial Officers, Finance Managers, Financial Controllers, Budget Officers, Finance Officers, Group Finance Officers, Graduate and Management Trainees, Accounts Payable Department, Accounts Receivable (AR) Department Managers, AR and Revenue Accountants, Billing and Collection Clerks, Credit Officers/Managers, Loans Department, and Sales Staff who interact with the Accounts Receivable and Credit Management Department.

Training Methodology

Our diverse instructional approaches ensure effective learning:

– Lectures & Presentations: Engage with expert-driven, stimulating content.
– Course Material: Access well-crafted supporting resources.
– Group Work: Collaborate on discussions and case studies for practical insights.
– Workshops & Role-Play: Participate in immersive, scenario-based activities.
– Practical Application: Focus on applying theoretical knowledge in real situations.
– Post-Training Support: Receive extensive support after training for skill implementation.

Training Outline

Understanding Credit Management and Cash Collection Techniques

Aims and Importance of Effective Credit Management

The cost of credit
Impact of bad debts
Stimulating cash flow
Effect of overdue debt on profit
Main objectives

Influencing Customers to Pay You Sooner

Factors affecting payment
Strategies for success
Planning
Knowing your customers
Recognizing diverse customer types

Assertiveness

Non-assertive behavior
Aggressive behavior
Assertive behavior
Benefits of assertive behavior

Using the Telephone as a Powerful Tool for Collection of Money

Assessing your telephone collection skills
Rules for successful collection calls
Taking control of the call tactfully
Overcoming reasons for non-payment
Utilizing influencing factors
Closing the collections call effectively

Effective Communication and Negotiation

Different communication and negotiation styles
Improving payments from large, powerful customers
Face-to-face negotiation techniques
Adapting to preferred negotiation styles

Maximizing Profitability Through Targets, Performance, and Cash Planning

Measuring and enhancing performance
Setting targets for success
Effective cash planning
Strategies for improving profitability
Practical exercises: Measuring performance and cash planning

Query Management

Impact of queries on payment delays
Improving front-end communication for efficient customer order processing
Handling purchase orders effectively
Addressing complications that may arise
Developing a robust query management system
Group discussions: Exploring and discussing query management challenges

Policy and Procedures

Policy content and terms
Understanding main policy objectives
Implementing procedures effectively
Credit health checklist

Emails and Letters

Rules for effective communication
Keeping emails and letters simple and modern
Influencing the reader positively
Practical exercise: Drafting an email to a customer with an overdue account

Sales and Credit Working as a Team

Building rapport with the sales team
Educating customers on your credit terms
Keeping each other informed
Efficiently managing customer relationships

Managing Commercial Credit Risk, Accounts Analysis, and Credit Scoring

Gathering the Right Information for Informed Credit Decisions

Identifying your customer and their legal status
Essential information for credit decisions
Effective methods for gathering necessary information
Understanding and interpreting collected data
Interactive exercise: Discussing required customer information and collection methods

Understanding Financial Statements

Interpreting balance sheets
Analyzing profit and loss accounts
Practical exercise: Analyzing a balance sheet to assess a company’s financial status

Working with Balance Sheets and Profit & Loss Accounts

Applying credit management principles without becoming an accountant
Key financial ratios and their significance
Scoring key ratios for credit decisions
Setting credit limits and ratings
Practical exercise: Applying knowledge to assess a customer’s creditworthiness

Ongoing Risk Assessment

Assessing risk in different industries
Grading customers based on risk levels
Differentiating between low, medium, and high-risk customers

In-Depth Accounts Analysis and Credit Scoring

Main Concepts of Accounts

Understanding accounting terminology
Performance and financial status measures
Working capital utilization
Days cash cycle analysis
Scoring key ratios

Getting Behind the Figures – Items Not Found on Financial Statements

Analyzing cash flow statements
Recognizing strengths and weaknesses
Factors impacting accounts analysis
Developing scorecards for credit decisions
Assessing higher commercial risks
Interactive exercise: Working with financial statements and reporting findings

Understanding Why and How Businesses Fail

Identifying warning signs
Recognizing warning signs in everyday dealings
Identifying warning signs from financial statements and customer visits
Interactive exercise: Group discussion on reasons for business failures and preventive measures.