Now that you know why you need a credit policy you need to come up with one that will work for you and your business. Some things to think about when sitting down to write out your credit policy steps are what you want your credit policies to do for you and your bottom line. The purpose of your credit policy should be to accomplish any of the following objectives.
I want my credit policy to:
Provide timely notification to any of my past due customers automatically to help my business eliminate old balances left on the books.
Outline steps and procedures that will provide my customers with options when they find themselves unable to pay in full or on time.
To provide my employees the steps to take when an account has a small balance due (interest, shipping, disputed item) in some cases a company might implement a rule that they write off anything under $10.00.
To provide step by step instructions to my credit manager when checking credit and setting reasonable credit limits for customers approved for revolving credit accounts.
Give us strict guidelines to follow on how to legally collect money due to us as a result of returned checks.
Have an automated system that will send out reminders to past due customers every week or two weeks.
Include the proper legal forms so that my business can keep customer credit card or debit card numbers on file with permission to automatically charge them at the time of an order or a specified date each month.
To have specific steps in place so our credit manager knows at what point an account should be placed with a third party collection agency and written off to bad debt.
Have steps in place in the event a customer’s order is held due to a past due balance, I want this to include notification to the customer and an easy payment option.