Case study

Credit Control Solutions

French company exporting to the UK outsourcing its Credit Control

French Fashion accessories manufacturer Maison HL with a turnover of EUR 20M distribute a luxury range of products in the UK through an independent sales agency, Mark Lee Agencies. The France based Export Admin team is in charge of credit control, with letters being sent from France, cheques being received in France which have to be sent back to the bank in England. The only telephone contacts are made by their sales agent Mark, but this is time consuming and sales have been stopped growing for the past three years. The Export Manager, Pascaline D, is looking for a cost-effective solution to improve her figures on the UK market.

Our Solution

CLI identified 2 key areas for improvement:

  • The credit control procedure clearly needed to be accelerated and energised. Sending payment reminder letters from the UK, offering a dedicated UK phone number and email address for Maison HL Clients to use should reduce payment delays and query resolution times
  • Maison HL should have a UK address so cheques can be received promptly, banked daily, and correspondence dealt with immediately which would improve customer satisfaction

Our Credit Control Solutions project manager organised a dedicated phone line and email address, opened a PO Box address for Maison HL at our local post office and assigned this project to 2 professionally trained credit controllers to ensure an uninterrupted service.

The Results

One year on, CLI visited Maison HL in France to discuss the achievements of the first year.

Pascaline said:

With Mark fully focussed on sales and Jean-Philippe, my export assistant, now able to spend most of his time on profitable marketing activities, our UK turnover has increased to £1.5M in one year, which is a 13.5% improvement on last year, and after 3 years of stagnation. C’est fantastique!

We also presented our figures to Pascaline and these showed:

  • A reduction of 28 days in the DSO from UK customers. Previously Maison HL’s invoices were, on average, paid 45 days after due date (their payment terms are 30 days) and this was reduced to an average of 17 after due date in one year. We estimated that half of that reduction was generated by the reduction of postal delays: simply setting up of a UK PO box enabling the prompt banking of the cheques and faster query resolution, made a significant difference. The rest of the improvements was attributed to more professional reminder letters, posted from the UK, more interactions with customers, strong lines of communications with sales queries notified to Mark and delivery and quality issues passed to Jean-Philippe.

Credit Control Solutions was also able to identify bad payers. Those of Maison HL’s customers who were ignoring our reminders, never returning our calls, and basically delaying payment without communicating were escalated to the CLI Debt Recovery Team. As a result, the 90+ day overdue balance on Maison HL’s sales ledger was reduced by 87% in the past year.

Are you in a similar situation?

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