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You Need to Establish Information Pipelines With Customers Taken Over in Leveraged Buyouts|
Tibco Software, Inc. calculated its earnings through the 12 months ending August 31 at $239 million. Vista Equity Partners, which is taking Tibco private in a leveraged buyout, has recalculated those earnings at $378 million. The Wall Street Journal reported that, in projecting this 58 percent increase, Vista factored in "cost savings the buyout would generate." We called Vista is ask what particular cost saving they had in mind. They have not responded. But while the nature of the savings may be vague, the purpose and consequences are perfectly obvious. . . . keep reading
Credit Today Benchmarking Survey: 2014 Unclaimed Property -- Credit Takes the Lead in Handling Unapplied Credit Balances|
We've heard the horror stories of unclaimed property audits and recognize that cash-strapped states are increasingly looking for additional sources of revenue, so we sought to quantify exactly what is going on out there. This survey gathered information on:
. . . keep reading
- What percent of companies have been audited, and of those,
- What percent paid a fine
- What states are doing the auditing (and how often)
- What percent of companies have formal unclaimed property policies
- Who put together those policies
- Any lessons-learned from those who have been through the process
Tech Notes: New Insights for Construction Credit Management and Automated Lien Management|
Credit executives involved in the construction industry face special challenges. Credit risks extend beyond your customer to include projects' physical and financial supply chains. The real risks are obscured unless you can access the Notices of Commencement, Notices of Completion, Mechanic's Liens, and Performance Bonds that are filed on construction projects across the US in each of the roughly 3,000 counties, and that show the true character of your customer and the contractors further up the feeding chain. Here we take a look at some great new tools to help you manage these processes. . . . keep reading
Forecasting Monthly Collections|
End-of-month collections are forecasted at this billion-dollar plus company at the beginning of each month with an average of 96 to 97 percent accuracy. That's been a boon to Treasury's cash planning and a valuable guide for Credit and Sales operations. We explore this forecasting system and extend its creator's invitation to contact him if you'd like to establish a similar system like this at your company. . . . keep reading
A Little Deeper Into a Cash Projection Model|
We spoke with this finance and statistics expert to gain insights to some of the details of his very effective cash forecasting model - how he gathers data, what data he likes most, what his goals are and what he tries to avoid. This is a great tool that he uses to help the Treasury function at his company predict cash levels and thus more accurately determine future borrowing or investing needs. . . . keep reading
Meetings that Work|
While a co-worker drones on about some problem his team is having that has nothing to do with you, you zone out. Staring into space you wonder if you should pretend to take notes, but instead make some sketches for the kitchen upgrade you've been contemplating and start working on a grocery list. Sound familiar? Unfortunately, many of us find this scenario all too familiar. Businesses everywhere force employees to devote considerable time to The Meeting. . . . keep reading
We've had a rash of fraudulent purchases from our branches. Any advice?|
My company is a large HVAC distributor located in metropolitan Chicago, northwest Indiana and southeast Wisconsin. Since February we have had a rash of fraudulent purchases from our branches. The party places a call to one of our branches representing themselves as the owner or purchasing agent from one of our customers. They then hire an outside trucking firm to pick up the order on their behalf. Once the truck drives off the property the driver is to call the phone number of the individual who placed the order for instructions on where to make the delivery. We know this from conversations local police departments have had with the trucking firms. The orders are typically $1200 to $2500 and when we have become wise to a potential fraudulent purchase we call the police who intercept the driver in our parking lot. The police are reluctant to arrest the trucking company as they have been duped as well. Due to the size of the orders the police have not been willing to deploy resources to follow the trucker and arrest the individual receiving the goods. We have had repeated conversations with our branch personnel of potential things they need to look out for such as the pick up being made in an unmarked vehicle, the drivers not wearing company uniforms, purchase orders not matching the company's typical sequence, etc. These conversations have resulted in several attempts being thwarted. I should also note that our company is not alone in being hit as many of our competitors have been hit as well. We have gone to the county sheriff's offices and the state level trying to get help to no avail. We update regularly employees that are allowed to place orders from our customer base. This information is stored within the customer's account on our computer system and pops up each time an order is entered. Each day we convert more and more customers to web ordering that requires a log in and password, but many customers still place orders through our branches and salespeople to make sure they are getting the unit that best fits the application they are working on. I am looking to hear from anyone that may have had prior experiences similar to this and any steps you took to reduce the threat. . . . keep reading
Help! We are having trouble automatically applying customer payments for those who use a bill payment service.|
List member Assistant Treasurer at _____, is having technical issues on the listserv today and is asking the following question: We are having trouble automatically applying customer payments who use a bill payment service. They seem to have the same remitter routing transit number and DDA numbers for those using the same service. So in other words, customers that used to be paying with unique bank numbers now are not, and we've found a couple of misapplied checks and our autocash isn't working. In addition, they're no longer sending remittance detail. We will be checking back with the original customers soon, but wondered if anyone else had run into this issue. . . . keep reading
Six Things Successful Credit Managers Do|
There are credit managers and then there are Credit Managers -- people who really know how to harness the strengths and talents of their team and make everything work, not only getting the job done but also creating an environment that fosters ingenuity and growth. Being an effective manager is essential in today's business environment. With success often being tied to the adoption of increasingly automated systems while simultaneously maintaining the flexibility to deal with diverse situations, the best credit managers know how to embrace new ideas and make them work. In order to become a top manager, you need to think and act like those already defined by success. The following six characteristics are an excellent place to start when re-thinking how you go about overseeing your team and running your credit department. . . . keep reading
The Downside of Automatic Credit Holds|
What are credit holds really holding up? Are they stopping orders from going out to customers who can't pay for them? Or are they a nuisance interfering with the smooth operation of your order-to-cash process? Too often, contends this credit management veteran, it's the latter. "We had an interesting event about a year ago where a system glitch caused nothing to go on hold from our service departments for over 60 days before we caught it," says this veteran credit exec. "Know what happened? Not a thing." . . . keep reading
Credit on the Front Line: Strategies For Neutralizing Damaging PO Language|
Forget Battle of the Forms, many credit professionals have to first address the "Battle of the Sales." This situation can be present within many industries and it will often confront the credit professionals that work in companies having multiple sales offices, receiving numerous purchase orders from customers. Although these battles are not new, we only need to look back a few years to see how they have mushroomed. In this article, you'll learn:
. . . keep reading
- How this credit exec combats aggressive customer attempts to slip PO language by them
- Four very damaging (to a supplier) purchase order clauses to watch out for;
- Four specific responses that neutralized the damaging clauses;
- The single most important principle that will both ensure and speed up customer acceptance of your changes; and
- One of the simplest and most brilliant responses to an obnoxious PO clause we've ever seen
Ten Dos and Don'ts for Achieving Credit Stardom|
A solid work ethic is something you hope all your employees possess. A person's ability to get done what has to get done and to be a productive member of a team counts for a lot. But work ethic is only part of the picture -- on the one hand, an employee's attitude and personality also play into their ability to be a high-level performer. On the other hand, it is possible to find an underachiever with a focused work ethic. Below are ten "dos-and-don'ts" that characterize the work ethics and attitudes of star employees and how they stand out from their lesser peers. . . . keep reading
A Credit Limit Tolerance Level Keeps Orders Moving|
Setting credit limits and then automating the credit hold process can be great for controlling risk and ensuring quality control. But if your credit limit parameters and protocols are too strict, you end up having to manually review a ton of orders that usually end up going through anyway. The system this credit manager developed was initially holding way too many orders that eventually, after manual reviews, were released. The two tweaks he made enabled them to continue to benefit from their automated system and cut out the the manual steps on the vast majority of orders. And their AR metrics continue to improve. . . . keep reading
The Leveraged Buyout Bubble Grows Again|
The good customer struggling with debt and disappearing into bankruptcy after a leveraged buyout has become stock footage in credit managers' nightmares. LBO debt levels in these deals is once again reaching and exceeding pre-Recession highs. Are we approaching another potential blood bath for unsecured creditors? Or, as some experts contend, is the LBO market now different and inherently less risky? . . . keep reading
Unclaimed Property Table: Due Diligence and Dormancy Periods in the United States|
The concepts of both "dormancy period" and "due diligence time frames" are both very important for maintaining sound unclaimed property procedures. You'll need to understand the concepts, have detailed knowledge of states' requirements, and finally, have a procedure in place to keep your compliance procedures on auto-pilot. In this table, we've compiled the dormancy periods (also known as the "abandonment period") for credit memos for all states, as well as the suggested due diligence time frames. . . . keep reading
Credit Today Benchmarking Survey: Learning from Your Own Companies' Extended Terms Requests|
The irony in today's environment of customers seeking - sometimes demanding - extended terms from their suppliers is that often, the companies at which credit departments are having to push back against customers' demands, are also themselves making the same demands of their suppliers. So our survey sought to learn from those who might have insights into their own company's demands for longer terms. What can we learn from them? Where do these demands originate? How often are they demands and how often are they simply requests? What are the reasons why a company might ask for (or demand) longer terms? Were outside consultants involved in these decisions to pay longer? Not surprisingly, many were reluctant to go on the record with some of the answers to this question. . . . keep reading
Credit Today Benchmarking Survey: Proven Responses to Requests for Extended Terms|
Many companies request extended terms to see how far they can push out payables. Simply giving in makes no sense. Even if an important customer demands extended terms, you shouldn't capitulate without a fight. The key is to remember that terms are a component of the pricing equation and therefore any request to extend terms will change that equation. With that in mind, our survey revealed seven key ways you should push back. To learn those seven key strategies as well as some great advice "from the trenches," read on... . . . keep reading