Maintaining a positive relationship and frequent communication with the sales department is not a novel concept—doing so has become fundamental for virtually any successful credit professional. Whether based domestically or throughout the globe, credit and sales teams simply must continue searching for ways to increase sales, profit and cash flow while minimizing risk.
As noted at last month’s FCIB annual International Credit and Risk Management Summit in Madrid, no universal set of methods exists to achieve this goal. Credit professionals from various countries attending the summit illustrated that the relationship between the sales and credit departments varies, sometimes significantly, depending on the company and its location.
“We meet regularly with the sales director and account managers. By creating awareness, [the sales department] realizes that they need us as much as we need them,” said Ingrid Ros, CICP, senior credit manager for Lyondell Chemie Nederland B.V., in the Netherlands. “The CEO decided that the credit department has the last word—if it’s no, it’s no.” However, Andy Yiacoumi, MCICM, managing partner for the Credit Management Institute Middle East FZ, LLC, in the United Arab Emirates, shared another perspective. Yiacoumi described the Middle East as a market that can be very sales-focused, with limited support for credit departments at times. “There’s a real imbalance between the credit and commercial departments,” he said of companies based in the region. “If the guy from the top just doesn’t get it, it’s not going to happen. You can’t lose the business, but can you afford to lose the money?”
Of course, looser payment terms can create a challenge for the credit department when it comes time to collect payment, noted Martine Zimmermann, ICCE, credit manager for F. Hoffman-La Roche AG, in Switzerland. “If you are giving payment terms for 120 days or are just saying ‘pay when you can,’ … Sure, it’s easy to sell that, but it’s not easy to collect,” she said.
As such, credit professionals in attendance agreed that regular meetings with the sales managers are vital to opening the lines of communication between the two departments. Luis Carmona, international manager for Informa in Spain, said it has been crucial for his company that the credit and sales team meets frequently, “more than others.”