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Optimizing Working Capital

Unlocking the power of your receivables

Using historical data to analyze root causes for complaints allows a firm to both identify and counter illegitimate complaints at an earlier stage. More importantly, it allows a firm to modify its internal processes and procedures. Long-term structured complaint analysis leads to improvements in logistics, services, and administrative processes. The result is fewer complaints, improved payment time, and reduced write-offs.

A Transparent and ‘Customer-Centric’ Strategy

For many businesses, credit, complaints, and collection management are still functions considered to be outside the purview of senior management. But at a time when there is much greater scrutiny of a firm’s accounts receivable and its true value in respect of how much is actually tied up in high-risk customers, a good credit, collections, and complaints policy is no longer a luxury and is certainly not a burden for companies looking to reduce the cost of their working capital. It is, alternately, a valuable aspect of doing business that provides tangible financial and operational benefits.

Supplying the customer no longer ends when the product or service has been delivered. Rather, it means maintaining a 360-degree view of customer relationships, allowing businesses to benefit directly from the level and type of customer engagement these functions can and will provide.

A customer-intimate credit manager not only clears the path to payment and improves accounts receivables, but can also form the strongest of bonds by understanding and analyzing customer behavioral information to ensure the relationship is sustained.

Elevating accounts receivable to a strategic level also provides transparency throughout the company—from the collection department, through finance and account management, to the CFO and managing director. This ensures that all business functions can apply a consistent approach to managing the customer relationship with the ability to identify early on exactly why payments are being delayed, and allow an informed and timely response in accordance with the customer’s profile.

Transparency is just as important externally because lending by banks has fallen faster and further than ever before. Banks may still be happy to lend to a well-managed and growing business, but they are not prepared to lend money simply to plug holes in a firm’s balance sheet. A much better way to balance the books, optimize working capital, and boost profitability is in unlocking the funds tied up in accounts receivable by adopting a strategic and customer-centric approach to credit, collections, and complaints management.


Reprinted with permission of the National Association of Credit Management.  Article originally appeared in Business Credit magazine.  For more information visit


David Taylor is the founder and former chief executive officer of OnGuard, a credit, collection and complaints software provider headquartered in the Netherlands with offices worldwide.