Experian Offers Tips for Weathering the COVID-19 Storm
Friday, July 10, 2020
Most companies are facing new challenges as a result of the COVID-19 pandemic. How they respond will significantly affect whether they survive and how well they emerge when conditions stabilize.
On its B2B blog, Experian recently offered four ideas to help companies respond to today’s challenges:
- Carefully Scrutinize New Suppliers: “Many companies fail to do their due diligence when it comes to suppliers, especially if they’re trying to fulfill orders quickly,” Experian wrote. “More often than not, this leads to bigger problems down the line. If you hire a supplier that’s hemorrhaging money, for instance, they may file for bankruptcy right after you pay them for a major shipment.”
- Make Sure Clients are Financially Healthy: “Experian has a special COVID-19 risk index that suppliers can overlay on top of existing credit models. This tool can help determine whether or not a client is in an unstable financial position.”
- Find Faster Ways to Evaluate Creditworthiness: “Using an agile credit system helps suppliers decide what kind of terms to offer their customers. Many companies are asking suppliers to extend their terms and due dates, often switching from net-30 to net-60. If companies in this position use an agile credit function, they can be more responsive and confident in the terms they set out because they’re basing their credit policies on the current state of their customer environment. This requires operating with the latest possible information on how current economic conditions are affecting their customers.”
- Consider Being Flexible with Clients: “While delayed payments from clients is upsetting, avoid taking your current client relationships for granted. While a more stringent approach from suppliers is understandable right now… the pandemic will end at some point. At that time, companies will remember which suppliers were flexible about payments, due dates and terms – and which companies weren’t.”
Read the complete blog post.