Information is power. Are you using all of this power that's available to you? Probably not, unless you're regularly on the Internet. We spoke with a veteran credit professional who daily demonstrates how much the Internet can do for sharpening credit decisions, building sales, and benefiting customers.

When salespeople from Wigwam Mills, Inc. (Sheboygan, Wis.) held an initial meeting with a prospective customer's buying team about a year ago, the buyers were "awestruck" by how much the Wigwam people know about their operations.

For example, plans for opening eight new stores had not yet been publicized, but the Wigwam sales force knew all about them.

Where did they get their information? Their source was Credit and Risk Manager Linda Chernault, CCE (now with Wisconsin Credit Association), who had used some Internet search engines to gather information on the company. "By being able to access building permits in small towns and zoning approvals from city councils, we were able to piece together that this company was opening the new stores," she recalls.

More recently, when she was negotiating a new line of credit with an account, Chernault became aware that the customer was experiencing some financial difficulty. She did not have any details, but she knew that the customer's SEC 10-Q (quarterly financial report) would be coming out shortly. Accessing the report was only a matter of pressing a few buttons.

"I got it off 'Edgar),' the SEC's Internet Web site," she says. The information turned out to be much worse than anticipated, and Chernault was able to use this new found information in the midst of the credit line negotiations to protect her company.

These are just two random examples of how Chernault "accesses the world" to make her job in credit and collections much easier and more effective. "The Internet gives credit professionals the ability to filter an incredible amount of information," she emphasizes. "It gives you access to information that simply was not available years ago. I can search much wider and further than I ever have been able to before."

Chernault identifies six general areas of Internet usage of particular interest to credit and collections professionals.

1. Information Filters. These sites, including Wall Street Journal Interactive, Point Cast, and My Yahoo, allow you to enter the names of your top 20 customers. "The software will screen those customer names against all available information they have," she says. "I come in each morning and have the latest articles on all of those customers."

2. Information Searching. Chernault divides these into two sub-areas:
   • Search engines (such as Metacrawler and Yahoo) allow you to access information on virtually all customers and topics you wish.
   • News and press releases (such as Reuters and P.R. Newswire) allow you to get up-to-the-minute information on customers, which is especially useful if you have just heard a rumor about one of those customers. (P.R. Newswire contains articles from hundreds of newspapers.) "I can access the latest authoritative information on customers within minutes," she says.

3. Financial Information. Several Web sites in this category allow you to access up-to-the-minute financial information on your customers, including stock quotes. "Rather than having to wait until the next day to check a stock quote in the newspaper, you can get it the same day," she explains. Other sites in this area provide trending information, such as:
   • Standard & Poors. "This provides useful trending information on earnings, sales and stock prices," she says.
   • Edgar. "This is the Security and Exchange Commission's Web site where you can get 10-K and 10-Q reports," she continues. Quarterly reports are available within 45 days; annual reports within 90 days.

4. General Research. A number of Web sites in this area can provide information on:
   • Bankruptcies. These include bankruptcy services, bankrupt accounts, and accounts that are being watched for bankruptcy potential. "There are even some bankruptcy courts with Web sites where you can file claims online and check on the status of existing claims," she explains
   • Accounts payable information. "Some large companies have their A/Ps on Web sites, so you can check your invoices and find out when your payments are coming out," she explains.
   • Z-score and financial ratio analysis.

5. Carrier Services.
6. International. "Recently, we were able to access information from the French stock market on a French company, which was a customer of one of our German customers," she says. "Within about a minute, I was able to tell our German customer about the financial strength of his French customer."

Getting Started
Chernault emphasizes that even the relatively computer illiterate can take advantage of the information the Internet has to offer.

"If your department's computer is part of a company network, ask for assistance of your company's IT (IS) department," she suggests. "If you have a stand-alone PC with a modem and direct phone line, you can do everything yourself, though."

Contact either a national or local service provider. Local service providers tend to be a bit less expensive, but they often do not offer as many services as the national providers, according to Chernault. Average charges are about $20 per month.

Usage is easy. "The first time I sat down, I was able to pull up very useful information in almost no time," she says. "I didn't even really know what I was doing. Most of the search engines are very easy to use. You just fill in the blank and push a button."

The service providers furnish you with the software, set you up, and offer assistance. "In most cases, you're set up in a day. The providers set up hundreds of people a day, so they make it very quick and easy for everyone." Should you pay for access to certain Web sites? That depends, according to Chernault. Most Web sites are free. Some charge, and are well worth it. Others that charge are not worth it.

"On the whole, you should be able to get most of the information you need for free," she says. So she recommends utilizing all of the free Web sites first. Then, determine whether you want to pay for other Web sites that provide information you are not able to get free of charge. "Some of these are worth the cost," she says, "such as Wall Street Journal Interactive."

She sums up Internet potential this way: "Using the Internet speeds up your ability to make credit decisions. You have access to so much information that you can often substitute this for the traditional trade and bank references that can often take so long to receive.

"In these times, if you have more, better, and quicker information than your competitors, you have the edge on them. Using the Internet gives you this information and allows you to compete much more effectively in the marketplace."

Editor's Note: The above article originally appeared in The Credit & Collection Manager's Letter,, published by Prentice Hall's Bureau of Business Practices, which Credit Today purchased in 2006.