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Frequently Asked Questions about TCD and SMART

Over the years, The Credit Department has fielded many important questions about our clients’ credit risk and commercial receivables management. Here are some of the most frequent ones we hear.

 

How do we know that hiring more internal credit staff isn’t a better solution?

In a smoothly running department that has excellent processes and sophisticated technology, you can simply replace or add qualified people. However, if you have numerous delinquencies, unforeseen bad debt write-offs and/or out-of-control deduction problems, you need to focus on the true cause of the problem. TCD can provide solutions.

How do I know if TCD services are right for me?

If you are experiencing any of the following warning signs, you would benefit from working with TCD:

  • Unacceptable level of bad debt expense
  • Greater than industry average days sales outstanding (DSO)
  • High employee turnover in your credit department
  • Complaints from sales regarding slow response and inexperience of credit department staff
  • Complaints from customers that credit personnel are unprofessional or don’t follow through
  • Reports you receive are not timely, not accurate or not accessible for critical decisions

How do you know the uniqueness of my industry?

TCD has experience serving over 100 industries and almost 500 companies — U.S. and multi-national. We leverage knowledge of trade credit terms and industry “best practices” in an effective delivery of trade credit analysis and trade receivables management disciplines.

Are there industries TCD doesn’t serve?

Yes. TCD specializes in and only provides commercial trade credit services to businesses and private equity portfolio companies. We do not provide consumer credit services.

How long does it take for the implementation to have impact?

In approximately 30 days, most businesses realize improvement on their ability to extend trade credit in a timely manner, receive payments and collect on delinquent accounts.

What value can I expect in working with TCD?

Real cost savings, improved customer relations, confidence in the integrity of your receivables asset and essential reporting to better manage and predict cash flow.

Does TCD work for my competitors?

The demonstrated values and business ethics of The Credit Department set the industry standard and duty to serve clients first. Because we are deeply integrated into your business, we may be privy to pricing, sales goals, promotion, trade credit risk tolerance and strategic plans. Serving competitors within your specific market space occurs only when agreed on by our clients and when in compliance with anti-trust regulation. Our secure technology is also designed to protect valuable data.

Why aren’t there other organizations like TCD?

Managing trade credit risk is much more complicated than just making collection calls. Few companies have the experience of working inside manufacturing, distribution and service businesses. Most highly skilled trade credit experts remain in Fortune 100 companies their entire careers. TCD has spent millions of dollars to integrate technology into our model and monitor the next generation technologies. Most companies that manage outsourced trade receivables do not have that technology or capacity to innovate like TCD.

How does TCD determine when to contact my customer for payment?

Use of TCD for collections is driven by the client’s trade credit, claims and collections policies. We can discuss options and timing that work best for you to obtain payment as well as preserve customer relationships that are critical to your business.

How does TCD work with my accounts receivable information?

Through the means of a secured access connection, TCD is working “live” in your accounting system through the simple export of data from your system into our software, where we securely manage the day-to-day receivables operation. We operate at the same time as U.S. business operations spanning East to West coast time zones.

How is trade credit worthiness established and credit limits set for a particular customer of mine?

Risk tolerance is defined by you and is applied to each transaction through a customized credit scorecard with elements specific to your business customers.

How does outsourcing to TCD impact my customers?

In essence, TCD is a seamlessly integrated branch office that communicates with your customers as you would. We are not a third-party collector; we communicate with the professionalism you would expect from your most talented employees. We are a strategic partner that, over time, becomes a cohesive and transparent component of daily business operations. We can support companies with no credit department as well as companies with in-house staff. In fact, our work with customers as a liaison of your company can support healthy customer relationships while improving receivables management.

Does TCD have international expertise?

Yes, TCD performs Trade Credit Risk Assessments and analyses for companies worldwide. Many clients use TCD services to assess all of their international credit customers.

 

Couldn’t find your questions here? Contact us or visit our Services pages.

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