Credit Matters

Invaluable Reading From Australia and Around The World

Contributing to our position as Australia’s premium Financial Risk Management resource, our management globally explores and surveys relevant and valuable articles published by respected professionals, academics and organisation. The articles offered here are suggested reading for any Business Owner and Financial Risk Management professional.

Invaluable Reading From Australia and Around The World

What role for the CFO in credit management?

Bertrand Mazuir

20 Mar 2015

It is not often you have the opportunity to read an article about the role of the CFO in the credit management process. Therefore it is interesting to read Bertrand Mazuir's review.

Finding the best way of operating a business is an on-going process of evolution. Therefore we should periodically review all aspects on the way we operate our business. These aspects under review should include the processes used, the people we employ and the titles we give them and their operational duties.

The CFO and Credit Mangers roles are no different. In preparing our review, the questions must always be: are these positions fulfilling the needs of the business at this time and do the respective people have the required skill sets for these roles? Bertand's review is one such opportunity to encourage you to evaluate these roles within your business.

Furthermore, irrespective of the size of your business, and even if you do not have the personnel to warrant such titles, you should be occasionally evaluating your own business processes and the people completing the roles of CFO/Accountant and Credit Management.

11 Secrets of a Successful Website

Ron Stark

11 Mar 2015

The eleven secrets which should be considered when building a successful website according to Ron Stark could also be considered in building your own business. People about to start a business, or those wishing to re-evaluate their business, are advised to complete a business plan.

Aspects of all business plans contain similar topics as those covered in Ron's list. The benefit in using this list of topics as part of your review is the language used. Ron uses topic headings which look less threatening to people not familiar with business and accounting terms and the issues of creating a business plan.

Many people enter the business world believing once they have created the business, nothing much changes. Unfortunately for these individuals, yesterday's business model, does not always survive over the long-term. Whilst the original business model might have been successful, that model may no longer be suitable for the current business environment. 

Irrespective of whether you are a newcomer or an experienced business person, evaluating your business from time to time, is part of doing business. If a business plan is perceived to be too big a challenge, perhaps using this list of 11 secrets is another way of undertaking the task. Ron says of websites, "A successful website is one that delivers what you expect of it." Therefore it may be a useful exercise for you to ask yourself periodically "Does my business deliver what I want?"

If your business is not delivering according to your expectations, it would seem to be a wise decision to complete a review using the 11 secrets as a guide or a fresh business plan.

The 5 legal issues to watch out for when investing in a franchise

Katherine Hawes

23 Feb 2015

Franchising is becoming an option for entrepreneurs by which they can enter in the business environment in one of two ways. It maybe as a franchisor who had a viable business and thought it would make a profitable franchise. Subsequently the franchisor prepares a franchise by which other people can buy in to and operate as their own business.

Less experience businesspeople often enter in to a franchise and provided a business structure and supported by the franchisor.

However you chose to participate in a franchise arrangement, there are legal codes which you should be aware of in order to protect your investment.

Katherine Hawes presents five legal issues which you would be wise to consider and explore before commencing any franchise relationship. The five key issues covered in Katherine's article are:

The Disclosure Document

The Code of Conduct

Buyback clause at the end of the franchise

Providing ongoing support

Establishing too many competitors

As usual, this information is a guide only and you should seek further legal advice before proceeding with any franchise agreement.

Best Practices: Invoicing to get paid

Colin Porter

17 Feb 2015

One of the reasons you might not get paid as quickly as possible is because you failed to complete your invoice(s) properly. When your invoice is incomplete, it provides another good excuse for your customer to hold back payment.

Colin's article highlights the key criteria which need to be completed before sending out your invoices. In addition, as Colin also helpfully points out, create a process to ensure your invoice is completed properly. This process can then be employed to train your existing staff and any new staff appointed to the task.  

Ensuring your invoice(s) are completed properly, removes one key reason the customer cannot use for not paying you on time.

 

Statutory Demands

Adam Stewart

8 Feb 2015

One of the weapons available for use against a delinquent debtor is the use of a Statutory Demand. Used properly, it is an effective tool in obtaining payment from your non-paying customer.

However the use of the Statutory Demand must be applied correctly as it is not without certain pitfalls if not served properly.

If you would like to know more, this blog by ADC Legal offers an introduction on the Statutory Demands. Of course, legal advice must be sought to ascertain whether a Statutory Demand is applicable for your situation.

Cloud Accounting Yes or No?

Peta Schimming

9 Jan 2015

Technology offers wonderful applications and tools for use in our business. One of the more interesting concepts is the use of cloud based products.

Peta discusses the possible benefits and negatives of using cloud based accounting systems. However many of the issues raised by Peta apply across all cloud based products and services.

If you are still wondering about using cloud based products, Peta's blog is worth reading as a start.

Don't Turn A Contract In To A Handcuff: The Boardroom Report

Adrian Kitchin

9 Jan 2015

If your business completes projects on a regular basis, you will probably already be aware of the importance of taking out an insurance policy on the major projects.

On the other hand, if you are a business owner or manager with little experience of the possible pitfalls of projects, you may not have thought of taking out an insurance policy for your next project. After all, not all projects are equal and many include significant risks for the unwary.

This blog raises a number of issues associated with projects which are worth considering. For instance, the importance of seeking professional assistance in understanding the terms of conditions of the contract associated with the project.

If you are inexperienced with the risks which may occur when planning your next project, this blog is worth a read as a starting place to begin the process of understanding project risk. You would also be wise to consider the benefits of obtaining insurance if there is any possibility of a material loss if the project does not go to plan.

Know your competition: Learn from their mistakes

Colin Porter

28 Nov 2014

Knowing your competition is one of the keys of operating a successful business.

Colin Porter in this article explains how you can learn about operating a better business from your competitors. In his view, you can learn a great deal about works and does not work in your marketplace.

Colin also provides his 5 tips for staying competitive.

I suggest this article is worth a read as a starting point for understanding why studying your competitors can help you operate and grow your own better business.

ATO Friend NOT Foe!

Peta Schimming

27 Nov 2014

In business, there are times when we have to interact with organisations which may not always our favourite business partner. In truth, most business people would argue the ATO as a party which does not add value to their business. Obviously many business people would not disagree with the previous sentence.

Unfortunately, whether we like it or not, the ATO is a serious player in our business affairs. As a result, Peta encourages us to take a proactive approach to our dealings with the ATO. Unless the circumstances are exceptional, the ATO is usually willing to work with you to resolve a problem rather than fight you (notwithstanding the ATO will probably always win).

There is also another business message you can take from this article. If you work with your suppliers and customers in a reasonable manner, many short-term problems can be resolved and so enable you to continue with the business relationship.

Good client bad client, how to tell

Jacqui James

21 Oct 2014

The point of entering a trading relationship with a customer is to make a profit. Unfortunately, too many business people are seduced by the concept of raising an invoice. Therefore when a new customer comes along they too often think of raising an invoice, not the nature of the future relationship and whether a profit will result.

However as Jacqui James points out, not all customers lead to a profitable trading relationship. Jacqui's list of what makes a good customer combined with her second list of what makes a bad customer, are therefore worth reviewing. You will be surprised how valid these lists are when you study the behaviour of your own customers.

I heard a quote many years ago which said "every mistake is a fruitful learning opportunity". Therefore I do like Jacqui's comment of  "Even a bad client turns out to be a good client. They teach you what it is you don't need."

The fact is, despite our best efforts, we all still get caught with an occasional bad client. When this happens, it is a good reminder; not all customers will add value to our business. However, these bad clients also teach us something more about our business process, if we take a positive perspective.

If you are interested in doing good business with the right type of customer, I suggest Jacqui's article is worth a read.

How To Win An Argument

Dean Kaplan

9 Oct 2014

When a dispute occurs in a business relationship, it is important to maintain a focus on the issues. Unfortunately however, these disputes can escalate into arguments. In these situations it is not unusual for emotions to rule the discussions rather than common-sense and then nobody really wins.

Dean Kaplan provides a number of strategies to avoid your disputes becoming the arguments. Whilst Dean is talking about his approach in the debt collection environment, his strategies apply across all areas of business.

It is probably worth remembering, amongst the most stressful work environments, where emotions can run wild, is in debt collection. Therefore I suggest, if Dean's strategies work in this environment, they are going to probably be effective in most business situations.

Inexperience business people or those with vested interests in the outcome, sometimes find it a struggle to keep focused on the issues during the initial stages of a dispute. Consequently these disputes sometimes become full-blown arguments. If you find yourself in these arguments and find it hard to create a win-win outcome, I suggest Dean's article is worth reading.

 

 

 

Here is What the Bank of England Thinks of Bitcoin

Alen Mattich

1 Oct 2014

Bitcoin has been with us for some time now. There are people who are really enthusiastic about its use, whilst others are less than impressed. Lately, there have been a number of articles about Bitcoin, almost as though it is the current flavour of the month.

I will not make a comment on whether Bitcoin is an appropriate payment methodology or not. However I suggest, this article is one source of information for you to update yourself on the current status Bitcoin.

Once have read the article you can make your mind up whether to do further research and ascertain whether it is a suitable payment methodology for your business.

Successfully Stop Sabotaging Your Success!

Vesna Grubacevic

15 Sep 2014

Vesna Grubacevic discusses the concept of people sabotaging their chances of success. She defines self- sabotage as occurring any time we want to achieve an objective and then our actions or lack of action prevents us from achieving the objective. It is not unusual for business people, at times during their business lives to subconsciously sabotage their chances of success. There are many reasons why this happens and we may not always understand how and why we take such actions.

The author presents seven reasons on why we might be sabotaging our chances of success. These reasons might be:

1.  A lack of clarity
2.  A lack of clear priorities  
3.  Limiting beliefs
4.  Internal conflicts
5.  Unresolved emotions 
6.  Being a worrier
7.  Negative self talk

As they become more mature, some people may begin to realise they are sabotaging their own efforts to succeed. However they may not do anything positive to resolve the situation because of a lack of confidence and support on how to resolve their issues.

The solution is not a simple one and professional help is always recommended. If you are interested in finding out more about this subject, Vesna's article is a good start in identifying the issues involved.

 

Top 10 Lessons Learned in First 10 Years in Business

Steveb Freztin

10 Sep 2014

In this article, Steve Freztin presents his top 10 business lessons after 10 years in business.

Every lesson presented by Steve, can be applied to any business profession or business organisation.

I would write more, but that may confuse the message. So I will simply say, it will only take a few minutes to read the article and I suggest it will be time well worth spent. 

 

Is Your Credit Policy Costing You Money?

Dean Kaplan

24 Aug 2014

Many years ago, when I first became involved with lending and advancing credit, I was advised that a reasonable level of bad debt write offs, was sign that you had maximise selling and profit opportunities. This case was put to me during my years involved with both consumer and business to business lending.

An open slather policy on advancing credit, is usually a good way of going broke and is not advocated. However a balanced approach about why you are in business, what it takes to succeed and how you should extend credit are questions should lead you to understanding why a level of bad debts is not always a sign of a business in trouble.

Therefore Dean Kaplan's article raises a valuable business question; "Is your credit policy costing you money?"

On that basis, Dean's article is worth reading as start for re-evaluating your credit policy and or learning about advancing credit.

 

My Mentor Is A Drug Using Scam Artist In Need Of Anger Management

Judith Dejino

21 Aug 2014

Learning is an on-going part of life. The strength of Judith's article is as a reminder that we continue to learn about ourselves from the most unlikely of sources.

In Judith's story, we see the mentor learning about themselves from the very person she was mentoring.

Irrespective of roles in life at any one time, I believe we can take a lot of positives from Judith's Lessons of Success illustrated below.

Lessons for Success

My mentors are teaching me to...

  • Keep showing up because it benefits both them and me.
  • Face challenges and find solutions in areas that I know nothing about.
  • Come prepared, but be agile.
  • Expect more from myself because they expect more from me.
  • Understand how I am influencing those around me which requires me to individualize my approach based on their needs.
  • Learn from everyone - those above, below and to the side of me.
  • Seek to understand before making assumptions.
  • Do it even though it is uncomfortable at times, so I can learn.
  • Believe in my abilities which are validated in every successful step I have influenced.
  • Be humble - you never know what gifts will come your way when you let down the walls of ego.
  • Realize that sometimes all that is necessary is to validate someone's worth.

In fact, the article itself is worth a read if you are interested in learning more about the world around you.

The Risk of Dodgy Debt Collection

Natalie Walker of Blitz Credit Management

5 Aug 2014

Natalie Walker illustrates a number of issues which can cause problems for the business owner who uses a dodgy debt collector. Her observations are based on a recent case brought by the ACCC.

Today there are strategies and tactics which are no longer acceptable and might be used by debt collectors in an effort to collect the debt. The dodgy debt collector will often employ such unacceptable tactics which are now illegal. In turn, if such illegal tactics are discovered, the ACCC may well take action, which allows become public at some stage.

Often, and what is often not realised by many business people, is that they can also be included in any action initiated by the ACCC. In addition, if the alleged behaviour is serious enough, the police may also become involved.

If you wish to avoid the unpleasant repercussions and bad publicity of using a dodgy debt collector, Natalie's article is worth reading.

Uncovering cash and insights from working capital

Ryan Davies and David Merin from McKinsey & Compan

24 Jul 2014

As the authors of this article so wisely articulate, managing a company’s working capital isn't the sexiest task in business. However as they also point out, it is extremely important in maximising the opportunities of improving cashflow without increasing sales or reducing expenses.

The most important part of this article is the authors' explanation of the cash which is tied up in a company's accounts receivable operations. In studying their work more closely, you will begin to realise the benefits of reviewing your accounts receivable operations.

We also find out why management and CFO's, particularly in the larger corporate companies of the world, do not concentrate on the receivables to the extent that they should.

I suggest this article is well worth reading if you are interested in improving your company's cashflow, profit and efficiencies, irrespective of the size of your business.

 

How to stop wasting time and start getting more done

Jason Smith

22 Jul 2014

Jason Smith has provided three handy hints about managing your time wisely.

What makes Jason's remarks valuable is that they come from a business owner who struggles with time management as do many of us.

Jason's three main hints are to (i) plan your day, (ii) take control over your emails they don't control you, and finally (iii) keep track of your daily achievements.

Tracking your daily achievements is as important as any other task. Tracking provides evidence of your daily work which in turn, gives you a level of satisfaction at the end of a business day when you may doubt you have doen anything worthwhile. In addition, you have the information to assist in preparing a more efficient working day in the future.

A quick look at Jason's Blog may help re-evaluate and refresh your own work behaviours so you gain better value of your own time.

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