Contents tagged with Trade Credit

  • Small Business Lending Down; Demand Up

    In the news this week were several stories about small business lending. In “Bank loans to small business fall to 12-year low” an analysis of FDIC data showed that the number of small loans to business of $1 million or less have been shrinking consistently.

    Small businesses rely almost exclusively on credit provided from banks. One reason small business lending is down was covered in another article, “Why Aren't Small Businesses Getting Loans From Big Banks?” which points to the big banks' new stringent credit policies. Bankers seem to be denying that lending standards are an issue, but small businesses report that borrowing has changed dramatically and has become an extreme process. The evidence seems to support the fact that there has been a fundamental change … more

  • US Firms Battle Late Invoices

    According to the "Atradius Payment Practices Barometer" survey ( cash flow management remains critical for businesses. 

    Key U.S. survey findings:

    Approximately 39 percent of American invoices were paid "late"

    Fifty-two percent of U.S. respondents reported customers had asked for extended payment terms over the last six months. Forty-eight percent had delayed payment without prior agreement.

    U.S. respondents' main criteria for selling on credit terms are: "credit check," "track record" and "reputation"

    Average domestic payment term: 28 days Average domestic payment duration: 28 days Average foreign payment term: 36 days Average foreign payment duration: 32 days

    The most likely impact of overdue invoices was the need to "take specific measures to correct … more

  • Credit Scoring, not just for banks

    Financial institutions use technology and credit scoring strategies to manage lending activity. Now businesses lending to their customers by extending trade credit are learning the value of adopting credit monitoring solutions as an integral part of account receivable best practices.

    The credit health of customers is top of mind for many CFOs today. Slow pays, delinquencies and credit losses have a major impact on companies of all sizes but are particularly harmful to small businesses that, in the past, have not had affordable credit scoring and monitoring solutions available.

    As businesses emerge from the recession and sales pick up, the best practice is to determine those buyers with a higher probability of payment before extending credit. Like banks, businesses need processes in … more

  • CPAs play a key role in helping small businesses implement payment best practices

    Poor management of accounts receivables is the enemy of cash flow. For small businesses today, 30-day terms all too often extend to 60, 90 and 120 days before payment is made.

    CPAs can help their small business clients better manage cash flow by proactively talking about their payment policies and procedures. Now is the time to help your clients set a 2010 goal of implementing payment acceptance best practices. Why?  Because by implementing sound accounts receivable policies with the objective of lowering working capital, businesses will achieve an operational advantage over their competitors.

    Business is, ultimately, about getting paid.  Businesses need to have enough working capital to fund their operations while they wait to get paid.  If a company can improve its … more

  • Vantage launches new site dedicated to B2B payments

    Vantage has launched a new web site at focused on addressing the specific payment needs of small and mid-sized (SMB) business-to-business (B2B) and business-to-government (B2G) enterprises. offers payment acceptance policies, strategies and best practices to lower cost, increase productivity and enhance security.

    Today’s most successful SMB are using a mix of technology and best practices to effectively manage their accounts receivables to increase cash flow and working capital. Managing credit risks, using lockbox services to automate paper-based processes and following AR best practice invoice tracking and follow up are being viewed as smart strategic decisions, giving SMB a competitive advantage once reserved only for big business.

    Likewise, … more

  • Don't Be Afraid of Accounts Receivable

    Many small and midsize businesses (SMB) we consult with are afraid of implementing policies and procedures to better manage their accounts receivable (A/R) because they are scared of losing customers. The thought is that if they enforce the credit terms established during contract negotiations that their buyers will simply find someone else to do the job.

    Are you scared of your customers? Is this fear preventing you from achieving A/R best practices? Don’t be afraid of making sure your customers pay you on time. The strength of your A/R processes sets the tone of your ongoing working relationship. If you allow buyers to explore how far they can push their payables and get away with it then what are you teaching your customers? Are you broadcasting that you are not good at managing … more