The collections manager has to focus on prevention to maximise on-time collections:
- Setting up an adapted collection policy.
- Overseeing the sales process.
- On-going control of the collections process.
- On-going control on the information systems supporting the collections process.
In the following diagram, we identify three main categories of customers by the different type of credit that was agreed with them:
- Open credit.
- Payment method set up in advance.
- Payment at delivery.
We will review the collection process for each category, and we will focus on the Firm’s efforts necessary to assure that the customers will pay on time, as agreed with them.
