If you’ve never heard Abe WalkingBear Sanchez speak, you may be shocked at his view on the role the credit department plays in customer service and customer retention. Yes, collections!
Abe WalkingBear Sanchez has been a business consultant and trainer since 1982. One of the founders of the A/R Management Group Inc., he is the author of Profit Centered Credit and Collections and co-author of the international book, The Best Kept Profit Secret: the Executive's Guide to Transforming a Cost Center Into a Profit Center.
As WalkingBear explains, "Before becoming a corporate credit manager, I owned my own business, so I understood at first hand the profit imperative. But what I found in corporate credit management was a mindset fixated on risk - and not on profit.
"It was because I could see that the corporation, and even its suppliers and customers, misunderstood and undervalued their Credit and A/R Management function, that in 1982 I decided to become a consultant and trainer."
In his article, The Cost of Missed Opportunities, WalkingBear states that using risk-based performance measures of DSO and bad debt causes companies to miss out on identifying areas of opportunity for improvement and revenue generation.
It’s WalkingBear’s view that those involved in POCM (past due customer management) need to understand that their role is ensuring the completion of the sale, not the enforcement of payment.
They need to know that the job is to identify why a customer hasn't paid and resolve the issues involved. If they do this, the company will be in position to get the most profitable sales, repeat sales.
If you think of credit as a matter of risk management you're missing out on an opportunity to increase sales, improve cash flow, control losses, and improve business processes. For the complete article, click here.
Abe WalkingBear will be speaking at the upcoming NAHAD (National Association of Hose & Accessories Distributors) annual convention in April on Trade Credit – An Alternative to Commercial Lending. Click here for the brochure.
Tribute, Inc. is a provider of ERP business management software for industrial distributors. Stop by and visit us at our booth at the NAHAD convention.