Company information: better early than late
Often, prospects ask me to quickly provide business information about a particular company. It is a small thing for me, and I am delighted to dive into the Belgian business database to meet that demand. But I also find it interesting to know why it is suddenly so urgent to get company information. Sadly, experience taught me that it usually involves a customer who does not pay.
However, in previous conversations between my prospect and their customer, there seemed to be no problem. The telephone contact was smooth and pleasant. The website of the party in question looked neat and – according to the customer – the order book was well filled. Business was fine. My prospect even did a check via Google Streetview and there was nothing to criticise about the building itself.
However, the payment of the invoice was not forthcoming and at the moment, my prospect finally called for my help, the agreed payment terms with his customer had already been considerably exceeded. His customer had already received several reminders and had also been contacted by telephone several times. However, the once sympathetic personality was becoming increasingly difficult to get hold of. And if it ever worked, they always had an explanation for the delayed payment.
I soon knew from experience that it was no longer useful to look up information about this company. I suspected that the damage had long been done, and indeed it was. The information about the company raised several alarm signals. Even for my prospect, it was nothing more confirmation of a vague suspicion.
Very often I see companies consult company information and perform a credit check when it is actually too late. They then realise that their customer has been struggling with financial problems for quite some time. It is therefore useful for any organisation, whether it is a small or a large organisation, to think thoroughly at which point they need to check the creditworthiness of a business relationship. It is better to consult company information before they even talk to a potential customer. After all, there are plenty of signals that show when things are going in the wrong direction for a company.
Consulting company information for existing or for new customers?
Is this the only time to check creditworthiness? Absolutely not. You should also regularly check customers who purchase from you. Especially with larger orders or very specific customisation, an extra check is often not an unnecessary luxury. A customer who has always been financially reliable may no longer be so, tomorrow – for various reasons. Situations change, so your customer may run out of reserves in the meantime.
For new customers or existing ones who purchase less frequently, it is best to check the company information with each new order. That can also have a positive effect. You may come to the conclusion that a customer who was late with their payment in the past, is financially much healthier today.
Looking up company information at an early stage always pays off
Never forget that it already costs you a lot of time, energy, and money to bring in a new customer. You sent brochures. You've called prospects countless times. Representatives made several site visits in their diligent search. All these actions come with a price tag. Then, you don't want to come to the conclusion afterwards that it wasn't worth all that efforts. So, don't be afraid to make well-founded decisions based on company information. Dare to refuse deferment of payment even if there is a valid reason for it. Checking company information and creditworthiness at an early stage of the sales cycle (prospecting) will always pay off in the short or long term.