External Debtor Management is is the outsourcing of your debtor management to another specialized company. This is often more advantageous, as good debtor management requires a lot of time and expertise. In addition, it will often save you time and money if you decide to outsource this part. In addition, your order to cash cycle is shortened. That is positive for your liquidity position.
What does debtor management mean?
Debtor management encompasses all activities that a company carries out to ensure that an invoice is paid (as quickly as possible and in full). This starts before you enter into an agreement with a customer and only ends when the payment is actually received. For example, prior to the process, the creditworthiness of the company can be checked in order to limit the risk of default. If an invoice is not paid, the debtor manager will have to take action. In addition to reminders in writing and by telephone, this also concerns, for example, sending reminders. Doesn’t this work? Then the debtor manager can call on a collection agency or start legal proceedings.
Why External Debtor Management?
For medium to large companies and service companies it is interesting to look at the possibilities for external debtor management. Some reasons to outsource your credit management can include:
- As a company, you want to focus on the core activities of your company again.
- You lack the time and manpower to conduct an efficient debtor policy and deal with any defaulters in a disciplined manner.
- You want to save on costs and improve your liquidity position.
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Benefits of External Debtor Management
External debtor management brings several advantages. For example, a stranger can often exercise more authority and thus ensure that invoices are paid on time. A few more advantages at a glance:
- You have more time.
- Your invoices are paid faster, which is good for your cash flow.
- Customization: you set the tone.
- Permanent creditworthiness monitoring.
- Extra pressure on defaulters.
How do I outsource my credit management?
You can easily outsource your debtor management via Debitan. Before we completely take over your debtor management and unburden you, we first visit you to look at the possibilities and your specific wishes. We will then create a custom accounts receivable administration for you. Read here more information aboutoutsourcing your debtor management via Debitan.
Rate External Debtor Management
The costs for external debtor management can vary greatly and depend on your wishes. The basic outsourcing package of Debitan is €99.95 per month.
Would you like more information about outsourcing your debtor management? Please feel free to contact us.