Risk Management

What is Risk Management?

Risk Management is an important part of the running of any business, and the granting of credit to customers is no exception. Credit risk management protects the lifeblood of the business, its cash flow. It helps to protect the business reserves and shareholder investment, yet it is all too often overlooked.

Identify, Evaluate and Minimise!

When offering credit terms on a business-to-business transaction there is always an element of risk involved. So how do you identify, evaluate, and minimise the risks to your business? Failure to have a robust risk management strategy for credit transactions could lead to catastrophic consequences with disruption to cash flow and the additional costs of legal action, both in time and money.

We have decades of experience in dealing with credit risks and credit risk management as well as insurance. Because of this, we are able to advise on simple steps you can take to improve cash collection, better identify and manage risks, and how you can integrate risk management with a credit insurance policy to maximise value.  

It is important to remember that because a ledger changes every day, it requires closer management than, say, a building, and all too often your customers and other supply chain partners have the same issue.  This means that a business you are dealing with can go from being a low credit risk to a high one, for instance if they have experienced a large bad debt leaving them short of cash. On the insurance side the most complex claims are often those made on long standing trusted trading partners, where credit risk management has become slacker.

How We Can Help

Our risk management advice and support can go all the way from these simple steps to a fee-based risk evaluation service (more suitable for larger businesses). What is appropriate is always led by you, though sometimes we may tell you things you weren’t expecting.

Our partners at 64G can provide outsourced credit control, to cover staff absences or just to provide you with more flexibility in the accounts department. Unusually, 64G are also able to manage a policy of credit insurance, ensuring that management of the ledger integrates with policy requirements. Where funding is required, they are familiar with invoice discounters and factors, and have no issues working with them.

To find out more about Credit Risks Management and minimize the risk to your business, do get in touch. You can also access our detailed leaflet covering further detail of Risk Management cover.