An article written for the Retail Motor Industry Federation (“RMI”) Magazine by Stephen Rose, Client Services Manager of CBC International
Credit Control Hints & Tips for the Retail Motor Industry
In the current climate, every business wants as much trade as possible and as we all know, ‘cash is king’ however, this should not come at the cost of a robust credit control procedure. When a business concentrates on sales the credit control can often be the first thing that gets put to one side. How many times have you heard the phrase, “I’ll do it later”? or “that can wait, I’ve got more important things to do”!….
Without a good credit control procedure you will often find that you have an increased number of bad debts and therefore the extra work that you’re doing can often just go to pay towards the debts that people have left behind. That’s why we’re here to help! As RMI understands that members want to concentrate on making money, they enlisted the support of CBC International (operating as RMI Debt Recovery Services), a specialist credit management firm based in Liverpool to assist members with the collection of their accounts. CBC is here to help members if necessary however, RMI feel that it is important that members also help themselves. CBC has kindly provided some helpful hints & tips in order for you to improve your internal procedures:
- When the owner approaches you to fix their vehicle, ensure that you collect as much data from them as possible. (e.g. full name, telephone numbers, address, email address etc) This short exercise can then assist you to contact the owner by all available means and ultimately help recover accounts should those owners not pay you within the agreed time period.
- Ensure that you have a well drafted terms of business (“TOB”). Should you have to take any legal action in the future, the TOB is what the court will rely upon to assess on what basis the work was carried out and what was agreed between both parties. It could be possible to recover collection charges from the debtor if a provision is contained in your TOB, we can advise on this. Make sure that you specify your terms of payment, such as 30 days from invoice date. This should also be stated on invoices. If possible, get the owner to sign you TOB at the time they bring the vehicle in.
- Do not extend large amounts of credit unless you have conducted a credit report on the owner. If the owner is an individual they would have to give you authority to conduct a report however, this could be a clause that was inserted in the TOB in order for you to be fully satisfied that they have the ability to pay a debt.
- Ensure that an owner inspects the vehicle prior to leaving the garage so that you can minimise the risk of a dispute arising relating to the work that you have carried out.
We hope that you will find these tips useful and you can apply them to your business however, if you wish to discuss any aspects of your credit control procedure or you would like assistance recovering accounts, please call CBC International on 0151 515 3014, email them (firstname.lastname@example.org) or visit their website (www.cbc-international.co.uk) and they will be happy to provide your business with the support that being an RMI member guarantees.
This article featured in the September/October edition of the RMI Magazine and is very much applicable for not only members of the RMI but everyone in the Retail Motor Industry. If you would like information on joining the RMI, please visit their website – http://www.rmif.co.uk/index.php?op=page&id=7
Alternatively, if you would like to discuss any service that is offered by CBC, please do not hesitate in contacting us as per the contact details above.