Credit Where Due

When Old School Is Like Gold

While technology has vastly improved the art of credit checking, an over-reliance on just one credit-check service is risky. BY NAT McCALL

Imagine you’re just starting your work week, and it promises to be a very busy one. No sooner have you hung up your coat than there’s an urgent request to set up a new customer. You open your browser to perform a credit check and upon clicking the bookmark, you get ... NOTHING.

Such was the case for credit professionals recently when they logged into a major provider. Emails urgently seeking information from the provider went unanswered. Finally, the company released information late in the day. They had taken everything offline due to a detected intrusion.

Imagine the disruption to your business if you were reliant on a single source of credit that went offline for a week, months or forever.

If you’re reading this column,

I probably don’t need to tell you that in today’s fast-paced world, automation of credit reporting and decisioning has become the norm.

Technology greatly improves our ability to digest and process lots of information quickly, decrease decision time and increase speed to market.

COVID-19 revealed what an unseen threat can do to businesses and created a ripple effect that impacted every aspect of life. “Adapt or perish” quickly became the rallying cry as industries and their credit professionals attempted to recover and navigate the ever-evolving pandemic situation.

If credit professionals have learned anything from COVID-19, it’s that we need to plan for the worst and hope for the best.

“Two is one, and one is none” is a saying that resonates in many people’s lives. It means that you always have more than one of whatever you need so that you’re never without. That certainly applies to credit-check providers.

Obviously, subscription-based services from multiple suppliers can be expensive and might be cost-prohibitive due to the budget or size of a company. How then do you get multiple data points without breaking the bank? How do you implement redundancies?

An easy and cost-effective way to broaden your reporting capability is to go through trade partners. The National Association of Credit Management and other groups often have discounted subscriptions or a la carte reports that can be pulled from major providers like Dun & Bradstreet and Experian. You may already be part of an organization that can provide these reports with media-focused intelligence.

Making BCCA’s Media Whys service a part of our tool kit is a cost-effective way to add a second or third source of information that also has the benefit of industry-specific knowledge that might otherwise be missing.

In addition to multiple reporting agencies, many companies have chosen to go old school. They rely more heavily on reference requests, calls to peers, trade group memberships and meetings – options

that were once the law of the land. With the advances in reporting, a lot of these techniques fell by the wayside. Maintaining contacts with your trade groups and vendors will often alert you to issues before they show up in monthly reporting. Preparation for the next phase of COVID19, or another type of crisis, is likely to result in old-school-meets-new-school practices. Credit professionals need to embrace both ways of getting information, as navigation will be as much about art as it is about technology. There has never been a more important time to communicate with sales teams about customers, soliciting word-on-the-street information. Calls or emails to customers, even if it’s just to touch base, are also essential. LinkedIn, trade groups (particularly ones that are industry-specific), trade shows and good old-fashioned contacts will be needed to help make decisions There has never been a more important that could one day mitigate or prevent time to communicate with sales teams about customers, soliciting word-on-thea loss. As offices reopen, networking needs to occur like it never has before. Analytics and data streams are street information. awesome tools for forecasting and predictions. However, they rely on someone to model them based on intelligence provided by people. There is a very real possibility that companies that have survived thus far will not make it through a resurgence or may be impacted by breaks in their supply chain. Be prepared. Seek out and pay attention to your peers across your industry and ones that interface with it. As a result, you may see a potential problem on the horizon before it looms large.

Nat McCall is the senior manager, U.S. credit and collections, at Discovery Communications. He can be reached at nat_mccall@discovery.com or (865) 985-7787.