of International Credit Management
Robert Paisola, Western Capital International Inc.
goals of receivables management must adapt to growing international
markets, and credit professionals must adapt to meet these challenges.
While the end result is that credit managers must do their best
to know their customers and specific market conditions wherever
they conduct business, there are specific goals and objectives which
those involved in international credit may wish to review:
financial flexibility. Review your banking arrangements. Use
banks and financiers (either in your own country or foreign)
with proven export finance operations and the best options to
achieve your financial objectives.
accounts receivable outstanding by increasing liquidity in order
to correspondingly decrease country or account exposures.
the mix of company assets. Learn about the laws and regulations
in your foreign market in order to provide credit or new payment
mechanisms to a broader range of customers. Spread your receivables
receivables to cash on a timely basis. Learn and understand
the options available to your company. Price receivables or
financing to accommodate the sale or conversion of receivables.
Meet and work with sales and marketing to understand how financing
can be a component of sales and pricing.
customer credit risk. Use new risk management techniques to
mange company and country portfolios, minimize payment risk,
and sell off assets. Use analytical procedures appropriate to
the foreign market. Use credit reports and established international
standards for quoting terms of sale and arbitration provisions
in all quotations and contracts.
responsive to individual customer needs. Every country has a
different inventory-to-cash cycle. Learn the characteristics
of each of your foreign markets and establish management practices
to accommodate t hose features.
the goals of the sales force whenever possible. Sales must work
with you on this: in foreign markets, credit and customer finance
are often the key to market entry and long-term success.
overall corporate financial constraints. A proactive international
credit and sales finance posture does not have to violate the
cash management limitations imposed be executive management.
It may be necessary to educate those managers on the benefits
of this informed and active position.