Set Frequent Sales and Profit Goals
EMost businesses set sales and profit goals when they prepare their annual budgets. But it makes better sense to have more frequent financial targets. Quarterly or monthly goals give managers an early warning system and more opportunities to revise their strategies sooner, rather than later.
Synchronize Credit and Sales Strategies
How often do you find that a customer with an overdue account is approved for a new order? Was there a disconnect between the sales and credit departments? Or, more likely, did the sales manager, eager to book an order, ask the credit department to cooperate and delay collection efforts?
Thats not good business. But it often happens anyway because of the absence of a specific policy on overdue accounts. There may be times when loosening the credit standards makes good senseas a courtesy to an especially good customer and with the CFOs OK. But it never should be an informal arrangement between the sales and credit departments.