Proactive rather than reactive credit control?

An ability to manage cash flow is crucial to business success, and the control and management of debtors is often a painful task, as a result of manual and repetitive processes. Recent external economic factors resulting from the impacts of a long term global recession, only adds to headaches of a credit control team. An introduction of effective tools to improve the collections process, is arguably more important today, than at any time in recent history.

Credit controllers are traditionally regarded as an essential element in business to chase late payments, and respond to customer queries. However, why just be reactive in this field when you can be proactive? Proactive businesses are generally regarded as market leaders, and those who are reactive are more likely to be ‘me too’, or market followers. The traditional style of credit control is a purely reactive process. You wait for non payment, and chase. Just because that is the way it has been done, does not mean that is the way it should work in the future. There is a better way.

Software is available now which can manage credit checking, credit insurance and risk analysis, through to promised payments. There is software which can even produce and automate chase letters and copy invoices. By proactively contacting the customer at various points in their lifecycle, rather than simply awaiting non payment, this software can automate a more proactive customer conversation. Throughout all phases, every event or process is tracked through credit controller’s workflow with in-built escalation procedures, and excellent supporting management reporting. This allows the credit controller to be freed from the everyday, and time to concentrate on really exceptional cases.

A major benefit of this pro-active approach is that the relationship between credit control team and the customer becomes positive. Most credit controllers traditionally ring up only to complain that the account is overdue for payment. By actively managing the account, it becomes possible to see any difficulties in advance, and work them out with the customer before they turn into a problem.

Safe credit control has taken these concepts of customer relationship management (CRM), and applied them to the credit control function, providing a softer, service orientated team of customer service representatives. If your current processes could be improved using our software and outsourcing services, why not get in touch?

Eddie Stanley, Commercial Director for Financials and Credit Control

Go anywhere credit control and spread the word!

As there is an increasing trend to work from home, so there is a need for more portable and accessible ways of working. Working from home or indeed the local coffee shop, saves company space and resources, and provides employees with a more comfortable working environment.

Additionally in these days of distributed office environments, for example, branch networks either locally or internationally, access to key management information from these disparate locations is crucial to business success.

Furthermore, providing business critical data directly to your clients, will generate a rapid return on investment not to mention empowering your most valuable asset, your clients.

For some reason though, a surprising number of companies seem to keep their credit control function and teams in house, and trapped in a single environment. Current, cost effective and readily available technology means this does not need to be the case. Software is available now which allows credit controllers, branch colleagues and their clients, to work externally to the localised environment. The reach of credit and query management can be extended using web based software via an online portal. Within a web browser, permitted users can check reports, handle enquiries and interact with the internal credit control team.

Trusted colleagues gain access to all their associated clients credit control related data and clients themselves may access a reduced subset of their own data.  Available data includes client turnover, aged debtor profile, balances and outstanding queries, not to mention full access to all current and historical transactions including the ability to download copy documents.  Other documents, chase letters and customer statements may also be viewed and downloaded via the portal.

The option to interact with the credit control team by adding notes or changing the status of a query or outstanding action radically improves the interaction with the team.  This shortens resolution time, hence enabling outstanding debt to be resolved in a much shorter timescale.

To find out more about Safe Credit Control, visit www.safe-creditcontrol.co.uk and complete an online enquiry form.

Eddie Stanley, Safe Computing, Commercial Director, Financials and Credit Control.

Emerge from global recession, increase information, and reduce your manual intervention

The recent global recession has produced a turbulent economic environment, affecting individuals and corporations in equal measure. The nonstop growth of the credit culture has had significant impact on individuals, leading to mortgage defaults, reduced spending on the high street and a general tightening of the belt.  Business is no different. Banks are unwilling to provide loans to invest in new opportunities, and also not extending overdrafts.

Credit rating and data providers are set to play an increasing role in helping businesses to stay abreast of their client’s financial health. Activities to do so involve managing their client’s debtor situation, and being aware of any impending customer insolvency.  Many suppliers of such data now provide an ongoing service to alert clients of any activities that are likely to affect the credit worthiness of their customers and suppliers. These could include county court judgements (CCJs) issued, new accounts filed, risk or delinquency scores, and offering recommended credit limits. This supplements the traditional credit check and report process, which still plays a major role in checking process of new or prospective client customers.

Given the recession, you would expect the popularity of credit insurance to have increased, however, the cost of this service has also increased and hence its take up has remained static. In the case of credit rating and insurance solutions, the manual effort involved in acquiring and processing the data is significant. The information gleaned from this process is, more often than not, disparate to the commercial business solutions in place.  By easing the manual processes required and integrating such solutions with the finance systems, there is an opportunity to increase efficiency, reduce costs and drive down poor credit performance. Safe Credit Control reduces these manual processes, and could help your business, so get in touch to find out more.

Eddie Stanley, Commercial Director for Financials and Credit Control

Credit control and CRM, working together?

Customer relationship management systems are an increasingly hot topic in the IT related press. Organisations are increasingly seeking to automate their ‘front office’ activities where possible, and see credit control as very much a ‘back office’ function. Traditionally, credit control is a reactive exercise, controllers chasing late payment as Rottweilers, not the cuddly teddy bears associated with CRM.

Adopting a softer, CRM based approach to credit control is, as the name suggests, about cultivating a relationship with the customer.  By employing CRM techniques, we give the customer the impression they are special, and that the credit controller has a holistic view of their account and the person they are communicating with. Any software system should therefore be able to provide all relevant customer facing personnel with a comprehensive view of all dealings with the company. An all round, sometimes called ‘three sixty degree’, view.

Creating a relationship on a one to one basis, encourages trust between the parties involved.  A customer promising to pay transactions is far less likely to default, if they feel they are letting a ‘friend’ down rather than the unknown face of a traditional credit controller. One software and service provider has embraced this concept, combining CRM practices into credit control activities which in turn separates them as a thought leader in the market.

This software solution, available today, tracks every single communication between credit controller and customer, each conversation, every letter, all emails, the whole relationship committed to record.  Automated events are diarised to drive a daily workflow for the credit controller.  Typical events include overdue invoices, exceeded credit limits and risk reviews to name but a few. The credit controller is guided towards their daily tasks, with all the related information necessary to complete the task readily available.

To find out more about Safe Credit Control, visit www.safe-creditcontrol.co.uk and complete an online enquiry form.

Eddie Stanley, Commercial Director - Financials and Credit Control, Safe Computing.

It seems acknowledged that typical payment terms are usually 30 days, but according to research average debtor days, in some cases extend to  61 days*. Remarkably many companies appear not to place sufficient focus on such excessive debtor days. However in times of recession, where cash flow is one of the most important things to manage, who can really afford to wait that long?

Waiting two months for payments due is in my humble opinion far too long. Businesses in these tough economic times do not have the borrowing abilities they had previously, as banks become increasingly inflexible, and under closer scrutiny, since the public bailout in the UK. Indeed, the new UK coalition government has just unveiled plans to scrap the financial services authority (FSA) for not keeping banks on a tight enough leash. Control will go to the Bank of England, which will no doubt in the long term mean stricter rules for banks to adhere to, and less borrowing to be had.

So what is the impact on your enterprise? With money you are potentially owed sitting earning interest for your customers rather than you and potentially paying interest on overdrafts, you are losing out big style! Whilst your overdraft facilities could potentially previously handle the deficit in the short term, your bank holds the right to change that. If your bank was to withdraw your overdraft tomorrow, would your cash flow cope? Your company can make a loss more than once, but running out of cash could be the end.

Rather than wait the traditional 30 days before manually chasing, our software tries a softer, earlier, automated approach. The impact for our customers is a vast reduction in debtor days, improved cash flow, and much better customer relations. The impact to you could be the difference between trading today, and gone tomorrow. If you think our software could help your business, get in touch. info@safecomputing.co.uk.

*Source: http://www.findoutinfo.com/direct/CD001?stylesheet=USE315.xsl

By Eddie Stanley

As most of us in the payroll and human resources (HR) business are aware, the traditional ‘sick note’, otherwise known as a Doctors Medical Certificate, was replace in April this year by the ‘Statement of Fitness for Work’ (Med 3), also known as the ‘fit note’.

This new certificate gives the doctor the opportunity to advise the employee that they are either:

o   unfit for work

o   may be fit for work

The new option of ‘may be fit for work’ means that fewer employees will be ‘signed off’, when they could possibly do some, or all, of their entire job, with support from their employer.

This will mean the employer discussing with the employee:

o   a phased return to work

o   reduced hours

o   amended duties

o   workplace adaption’s

o   a combination of the above

However, the GP’s advice on the fit note is not binding. If the employee or employer does not agree with the fit note’s reasonable adjustments, the employee can remain off sick until the expiry of the fit note.

Good practice is to discuss the issue of pay, particularly where there is no contractual sick pay. However, the employer’s responsibility for Statutory Sick Pay (SSP) will not change. SSP will be still payable under the current rules for a sickness absence of four days or more where the employee meets the qualifying conditions.

If doctor has advised that an employee may be fit for work, it does not automatically mean they can return to work. The employee could remain off sick because the employer is unable to provide the necessary support. The employer should consider the advice on the statement in such a case as, ‘not fit for work’.

The employer and employee will need to consider the financial impact where the employee is supported back to work by reducing their hours, and if an enhanced SSP supplement is paid. Any issue related to this should be discussed with HMRC on 08457 143143.

The introduction of the fit note has not been universally welcomed, as there is concern that GP’s are not occupational health specialists. GPs therefore do not have the knowledge of an individual business, to make recommendations about adaptations to the workplace. From an employer’s perspective, there is also an implication under the DDA (Disability Discrimination Act) of not implementing GP’s advice.

More information can be accessed by logging onto the DWP website http://www.dwp.gov.uk/fitnote/

Your software provider will be best able to offer advice on maintaining any Occupational Sickness Pay schemes you may be operating along with sickness monitoring, which may include workflows, triggers and the Bradford Factor. If you think your current software may not be able to cope with these changes, contact Safe Computing info@safecomputing.co.uk, or visit www.safe-ems.co.uk and www.safe-tempestsuite.co.uk to find out more about our products and services.

By Tamara Pattman and Bonnie Holland

Eddie Young writes ...’A wise man pointed out to me many years ago that for every pound of unnecessary expenditure, it takes two extra pounds of revenue to return it to profit.

Competition has never been greater than in the staffing world. The fight for margin is a tough one, especially where clients hold the upper hand on billing rates. This situation tends to focus the mind of staffing companies on the ‘coalface’ of sales negotiation. With the hope that volume negotiated there, will offset low unit margin. It is the service industry equivalent of ‘pile them high, and sell them cheap’.

Basic bookkeeping teaches that revenue generation is just one half of the equation. Controlling costs is equally important. Many employment businesses find their processes have grown around ‘necessity’, without regard to cost. Volume business, discounted or not, might improve the gross margin but can severely impact the bottom line. Support systems responsible for the processing of the payroll for workers, and the raising of invoices to clients, and cash collection, can struggle to keep up. The solution is all too often an increase in headcount, or squeezing even more commitment out of staff in the middle or back office.

It is time to take a step backwards and regroup.

Firstly, there should be no ‘sacred cows’. Laissez-faire should  absolutely the last option.

Secondly, how much of the additional strain is there on systems which process data the business collects? Could these strains be eased by thinking a little bit smarter? How much of your data is collected and keyed into computer systems multiple times? The days of duplication should be put firmly behind us. Such duplication is not only inefficient, it breeds error.

Thirdly, can the increased efficiency of such a systematic review only benefit your staffing business? Can efficiency also improve the level of service to stakeholders, such as the clients, workers, and suppliers you interact with?

Fourthly, business systems are already available to address the challenges of the modern staffing world. It is not unchartered territory.

Finally, you can bet your bottom dollar that even if you eschew any consideration of change, your competitors probably won’t. Change can be for the better of your business, and can sometimes even put you ahead of the competition.

Go on. Make the change. Feel the benefits!

Hi I’m Eddie Young, and this is the second in a series of blog entries I hope to bring you, exploring some of the burning issues faced by our industry today. In this instalment, I’ll be talking about ways you can cut costs and increase efficiency, both important for survival in our difficult current economic climate.

Clients are savvy these days, you can’t get the most money just by charging the clients more! You have to create efficiencies by reducing procedural costs, while increasing business efficiency. We have developed products to try and assist with these aims. These include timesheets which can be sent to a fax server. Or, we can even help with electronic collection of timesheet data via scanning, web portals, and client timesheet data via spreadsheets. The days of one size fits all are over! You don’t have to have one stakeholder doing all the work. Someone could be doing the inputting remotely, and sending it to you electronically, saving you precious time and resources.

Removing a paper trail is vital. Not only is this vital for saving our planets resources in these increasingly greener days, but also to save time, and reduce margin for error. Electronic timesheets eliminate the time lag between a timesheets completion, authorisation, and processing. Debtor days are reduced, as invoicing can be completed days earlier than the paper based equivalent.

I’m not describing the world of science fiction, this is happening today. Even where some of our clients don’t feel ready for electronic authorisation of timesheets, there is a gentle introduction. The ability to deliver to a worker their timesheet for the week, and print it ‘in the old fashioned way’ once completed, can be achieved electronically. This method is regarded by some of our software users as an introduction to the principle.

I’ll be writing a further few blog entries soon, but would be interesting in hearing your thoughts on these matters or anything else relevant to our industry on info@safecomputing.co.uk!

Hi I’m Eddie Young, and thank you for reading my blog. I want this space to be about the burning issues that face our industry, and this is the first of what I hope to be a series of blog posts.

Employment businesses are increasingly reviewing their relations with clients and workers, in the light of further legislation, coming soon. They are considering the impacts of this legislation in this changing market.

Back in 1998, there was a lot of talk about holiday pay, and a lot was around how to minimise its impact on margins! This view was a reflection of an anticipation, that the agencies were worried they might have to make temps move off their books early! One client was worried they might have to finish a temporary worker, on a Friday, only to restart them on a Monday, to avoid any pitfalls and complications around continuous service!

Thankfully temporary workers are a little more savvy these days, and know they are entitled to the same rights as those in comparable roles, but what are comparable roles? There are no official guidelines from the government on this. Agencies have to agree these with clients, and clients need to agree what they will accept after 12 weeks service, as rates may increase.  People seem to currently have their ‘heads in the sand’ over this issue, and we need to find a way forwards.

Ireland have taken advantage of the ambiguity, and can’t give any firm dates yet on the agency workers directive (AWD) current issue. Rather than just revise that aspect, they are looking at their whole legislation in relation to agency workers.

I’ll explore some of these issues more in a further few blog entries, but would be interesting in hearing your thoughts on info@safecomputing.co.uk!