The Four Pillars For A Successful Credit Control

Many thousands of businesses go bust every year simply because they are owed money and can’t juggle the cash flow. Systematic, well planned credit control practises must be put in place right at the start otherwise your company will join the mountain of other failed firms. Checking references, getting credit reports and examining company business information is a sign of strength for a business and lets your customers know you are serious about credit control

1. Get a detailed application form filled out correctly by your potential customer.

So many businesses are in the rush to get orders that they do not do the necessary groundwork when setting up customers, in some instances not even knowing the correct legal entity or billing address. All of these minor details can slow up getting paid on time!

2. Do the necessary credit checks on ALL customers small or large.

When you are looking to supply a customer you need to carry out a credit report, these reports are instantly available through credit reference agencies online and can be purchased on a 'Pay As You Go' basis at under £10 per search or within bundles which can cover you for a years unlimited credit reports. 

In my professional opinion the bundles are the way to go as you get so much more within them.

3. Stick to your credit limit and credit terms.

From the outset you will need to be tough as customers will look to bully or bluff a higher credit limit from you, so stick to your limit! This also happens when it comes to payment with some customers looking to set their own terms of payment. You will need to be firm and not waiver because if you allow them an inch they will no doubt take a mile! 

You could even make a telephone call or send an email gently reminding your customers that payment is due on a certain date, this shows good customer relations but also that you have your finger on the pulse.

4. Don't be afraid to use debt recovery agents to recover outstanding monies owed to you.

This is one step that businesses do not grasp as much as they possibly should. You can utilise the professionalism of an outside debt recovery agency without costing yourself or your company time and lots of money. Any debt recovery agency worth its sort will not charge upfront fees, they simply apply a commission charge if and when they are successful. 

Obviously doing the chasing and sending letters has an expense to yourself so if you are getting nowhere with a delinquent debtor why not pass it on to the agency and let them recover the money for you. 

Usually a good commission rate is between 7 - 12% on any monies recovered, but remember it is your right to add costs and interest to the debt from the date it becomes overdue.

If you would like to know more or have any questions please email me on martin@creditserve.co.uk or follow me on twitter @creditserve

The Corporate Version of Phoenix From The Flames...

In mythology, a phoenix is an immortal bird that, when it dies, bursts into flames and is reborn from its own ashes. "To rise from the ashes of the phoenix" means to make a miraculous comeback.

We are all well versed with the saying 'Phoenix From The Flames', however the meaning has taken new form recently with the corporate world seeing more and more limited companies failing and then resurfacing shortly after under a very similar limited company name, with the same business shareholders and directors!.

Now companies that fail for whatever reason is not new as new statistics tell us that 50% of new businesses do not make their 3rd birthday. This is quite a staggering statistic, however we all know that for whatever reason there will always be businesses that cannot continue to trade.

There are some ways of protecting your company against this form of injustice, one way would be to carry out extensive credit checks prior to dealing with your customers. Credit agencies offer online facilities to obtain instant credit information. These credit reports are generally well detailed with financial accounts, shareholder information and director information, within the director information you will be able to view other limited companies that the respective directors have operated and their current credit limit and status.

These online credit checking agencies provide what is called a monitoring service which will keep you informed via email of any changes which happen to your customers and therefore will keep you up to date with important

Creditserve offers various credit reporting solutions which can assist in making initial credit decisions, maintaining account management through company monitoring, group structure credit reports, director database reports, companies house documents with our professional debt recovery department as a back up to the online credit checking facility we offer.

There are packages to suit any size company or budget and our credit reports are of the highest standard which makes Creditserve one of the fastest growing credit reference agencies in the UK.

If you would like more details on any of our services whatsoever please do not hesitate in contacting us through sales@creditserve.co.uk, LinkedIn Page Creditserve Business Information, twitter@creditserve1 or on 01992 414222

Information Relating to the Disqualified Directors Register FAQs

Disqualified Directors Register FAQs

Q. What is the Disqualified Directors Register?

A. It is a register of persons who have either been disqualified through a court order or by an undertaking of the Insolvency Service from being directors of companies or members of LLPs. The register shows the length of time the director or member has been disqualified. It also shows the section of the Company Directors Disqualification Act 1986 that the director has been disqualified under.

Q. Why does Companies House maintain a Disqualified Directors Register?

A. The Secretary of State must maintain a register under section 18 of the Company Directors Disqualification Act 1986. Companies House performs this function under delegated authority for the Secretary of State.

Q. Can I obtain a copy of a disqualification order from Companies House?

A. No. The courts do not submit copies of disqualification orders to Companies House. Court officials extract information from the orders in order to complete prescribed forms, which are then used to notify Companies House of a person’s disqualification. Likewise, the Insolvency Service provides Companies House with information where a disqualification undertaking has been made. It is these particulars, received from the court or the Insolvency Service, that make up the Disqualified Directors Register.

Q. How do I access the Disqualified Directors Register?

A. The register can be accessed through the following link: Disqualified Directors Register

Q .How much does it cost to search the Disqualified Directors Register?

A. It is free of charge.

Q. I’ve checked the Disqualified Directors Register and the person I am interested in is not on the register – what does this mean?

A. This could mean one of the following three things:

the person is not and has not been disqualified;
the person was disqualified in the past but the disqualification order has since lapsed (it is a legal requirement of the Company Directors Disqualification Act 1986 that details of lapsed disqualification orders are deleted from the register);
the person is disqualified but we have not yet received official notification from the courts or the Insolvency Service.
Q. Is someone who has been disqualified allowed to act as a secretary?

A. Yes. This legislation only prevents disqualified persons from acting as company directors or LLP members. This does not apply to secretaries providing they are not involved in the promotion, formation or management of a company.

Q. Does the legislation apply to bankrupts?

A. Yes. If you have been made bankrupt and your bankruptcy is still in force, you cannot act as a director of a company or member of an LLP. However, the bankruptcy register is held by the Insolvency Service and can be accessed via www.insolvency.gov.uk

Scottish bankruptcies do not appear on the Insolvency Service website. They can be found on the Accountancy In Bankruptcy website which can be accessed via www.aib.gov.uk

Northern Ireland bankruptcies can be accessed via www.courtsni.gov.uk

Q. Under what circumstances are directors disqualified?

A. Examples of the most commonly reported conduct for disqualification are:

continuing the company's trading when the company was insolvent;
failing to keep proper accounting records;
failing to prepare and file accounts or make returns to Companies House;
failing to send in returns or pay to the Crown any tax that is due, and
being involved in fraudulent activity
For more detailed information on when a disqualification can occur, please visit the England, Wales or Scotland Insolvency service website or the Northern Ireland Insolvency service website.

Q. Your Register of Disqualified Directors refers to 'Exemptions'. What does this mean?

A. Under the legislation a disqualified person can apply to the Court for permission to act as a director of specified companies. If the application is successful these companies will appear on the register under “Exemptions’.

Q. Where can I obtain further information?

A. For more detailed information, please visit the England, Wales or Scotland Insolvency service website or the Northern Ireland Insolvency service website.

Giving Credit Terms to Foreign Companies : European Credit Reports & Business Information

Does your company deal internationally?

If your company deals with European or International suppliers and/or customers it can often be a treturous proposition, as often you may not realise what is available help minimise the risk of dealing with these companies.

One of the misconceptions is that foreign companies do not file the same degree of information as we do in the UK, this is a potential problem in itself because if you do not try and achieve the best data available you are already leaving your company open to the possibility of bad debt.

European or International credit reports and business information is now available on-line via credit reference agencies such as Creditserve and is often very cost effective and detailed.

European credit reports for the most part contain statutory information, company accounts, derogatory information, group structure, share holder information director information and credit limit and risk score. All of these pieces of information are compiled into a credit report which is easy to read and will help you make a informed credit decision.

The countries which you can obtain on-line credit information are:-

Belgium, Czech Republic, Denmark, Finland, France, Germany, Greece, Iceland, Italy, Lithuania, Malta, Netherlands, Norway, Poland, Slovakia, Spain, Sweden, Switzerland and USA.

The European and International credit reports are often used by UK companies who deal with UK customers but in-turn have parent companies overseas and therefore would need to know group strength as well, as this may have implications on the UK subsidiaries.

The European and International credit reports can be obtained on a pay as you go service or within bulk packages from websites like www.creditserve.co.uk and are very cost effective easy to download.

I have attached a sample European credit report which will give you an insight into the degree of information available within these reports.

If you have any questions relating to European Credit Reports please do not hesitate in contacting me direct via martin@creditserve.co.uk, @creditserve or LinkedIn Martin Brown