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Euler Hermes UK has launched Credit Vision, a sales ledger management tool that
enables credit managers to automatically compare buyer behaviour with their
peers across an industry, to identify poor payers and in doing so improve cash
flow, avoid unnecessary financial risk, and take on new business with
confidence.
Credit Vision works by comparing a Payment Index – a measure of how well and how
quickly a buyer pays across a particular industry – with Euler Hermes UK’s own
Risk Rating to give an overall picture of a buyer’s performance.
The credit manager can view this information on a single customer basis, an
entire ledger basis, or an entire industry basis.
From this, a business can then decide whether to extend payment terms for a
buyer, demand payment on shorter terms or even in advance.
Phil Mercer of Euler Hermes UK explained: “The product provides a transparent
view of a sales ledger such that a buyer’s credit-worthiness is immediately
apparent.
“Users can drill down into the data to see how many days each buyer is past
their due date; how much (as a percentage) of their portfolio is considered ‘at
risk’; and how much each buyer owes them and others in their industry.
“Payment trends can be easily identified, and businesses can see how fast they
are paid compared to others within their sector. Managers can therefore take
action with this information and see how much it is costing them financially,
and how it is affecting their DSOs.”
“Credit Vision is an analysis tool to help credit managers take sensible and
responsible business decisions. You can see how many companies are in the
database and obtain information on virtually any buyer you may wish to trade
with. Clearly the more those in industry engage, the more accurate information
will ultimately be delivered.
"All data stored is anonymous and secure,” he adds.
The Payment Index provides a score for buyers of between zero and 100, where 100
represents the best payers (those who pay in advance of due date).
This Index is automatically compared for each buyer against their Euler Hermes
Risk Rating; a grade of between one and 10 where 10 is the worst.
A buyer with a low Index score and a high Risk Rating alerts a credit manager to
potential difficulties such that he can proceed with extreme caution.
The information to allow comparisons to be made is the result of Euler Hermes
UK’s expertise and access to knowledge gleaned from its network of Risk Offices
who visit and analyse thousands of UK businesses annually, allowing Euler Hermes
UK maximum knowledge of their customers’ buyers.
It also uses published public information and proprietary information that is
not available from any other source.
Source:
Credit
Control Journal
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