Shopping

Guest
Merchandise Details

If an item is downloadable, you will receive an email with instructions after purchase. 
 

Doing Business With Small Customers & The Use of Courtesy Credit Lines
Sorry for the inconvenience, this item is not available for online purchase.

Member Price$0.00
Non-Member Price$10.00
Merchandise Description
Downloadable Item
 
The Credit Research Foundation recently looked at the different processes companies use for handling small customers versus larger customers. In our survey, we asked about the various methods and techniques used for credit approval for the different kinds of customers. The underlying notion is that orders for large customers are larger orders and therefore generate more revenue than the business from small customers (hypothetically placing small orders). There were some interesting findings as displayed in the following report.

In the interest of opening a new customer account expeditiously or when a significant percentage of existing customer orders are small enough that the expense of a credit investigation is unwarranted, 37% of business credit grantors are inclined to grant a credit line up to a pre-established amount automatically without examining the customer's credit worthiness or financial well being to save processing time and cost.

While all orders should be processed quickly, this is particularly important for first orders from new customers. Because proper handling of the initial order often means the difference between a gain or loss from continuing future sales, some system should be adopted whereby initial orders are quickly approved or rejected. The procedures established for handling initial, particularly small orders from new customers are also applicable to small orders from customers that have bought before but considerable time has elapsed since the previous order.