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Improving Credit Management and Debt Collection

4 Day Training

Dates: Anytime

Locations: Johannesburg, South Africa

Platform: Available In-Class / Online

Price: Available on request

This is a Non-accredited Course

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. This 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 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

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

DAY 2

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

DAY 3

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.

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