Credit insurance
Tel: 01424 217698 or 07971 996658 Fax: 0845 127 4385
Rycroft Associates
Credit reports - Why use them

Why use them? well for a company that you don't know the answer is fairly obvious (assess their performance history, check if they have a string of CCJ's (county court judgements) against them or anything else that may suggest that you are risking your money and possibly livelihood if it is a big contract).

But, what happens if you have known them for years?? I see as many people get caught out by long standing customers as those that get caught with new accounts.
Clearly familiarity brings it own inherent problems - for instance, If you have been trading with an account for a number of years, you are unlikely to start asking them about their current finances and if payment starts to get a bit behind, then what's the problem, they've never let you down before.

However, the reality of the situation is that they probably don't want to let any of their suppliers down, but if they get caught with a substantial bad debt or maybe they lose a key contract, then they may have no choice but to declare bankruptcy.

Whilst a credit report will not warn you of every situation, there are many occasions when it will alert you to a problem. For instance, rather than just get a report once a year have you consider using an alert system - this works very simply, you record which accounts you want to monitor and if any changes are made to the company report, then you are notified.
Obviously, if this is a string of CCJ's then you can make an informed decision as to how to deal with the account - i.e. you could actively collect your outstanding invoices which will at very least reduce the debt, rather than getting a letter through the door telling you that you are going to get nothing.

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Benefits -

The different systems available:

Standard report:- this gives you the latest filed accounts, charges registered, basic information (name, address, registration number - very important to check that you are dealing with the correct company, etc), and an analysis of the accounts in the form of an opinion of what credit limit to set.

Monitoring system - on top of the above, it is best to add the buyer to your account and then if any changes are made to the report then you will be notified - this has two functions, to advise you that there is a problem or to advise you that this company has recently filed accounts, the outcome of which means the recommendation of a higher limit (a good reason to go and sell them more goods).

So, a credit report can save money by helping you to either avoid or reduce bad debts and help you increase your sales.

Report costs could be as low as £4 each (for 100) or for unlimited access £700 this clearly is a good investment.

For more information or a quote, please contact Richard holroyd - 01424 217698 or 07971 996658 or use one of the contact links to request we call you.

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