Free Online Course in International BusinessValueThe credit report is only one source that a credit manager needs to make an intelligent decision about the level of risk. No seller should rely completely on a credit report. If a direct investigation is being considered in full or in part, there are other sources to be considered.The CustomerThe best starting point for credit information is always with a buyer. Some buyers are more forthcoming with information than other providing credit references, financial information, and details as to the background of the principals, and a history of the business. Many buyers, however, feel that their information (if it is a nonpublic business) is not to be shared with other businesses. In such situations, an international credit manager needs to be sure to develop a relationship based on trust, so that potential buyers are comfortable releasing critical information.The Sales RepresentativeA seller's sales representative abroad can also be a valuable source of information. In all probability, a sales agent has had the opportunity to study a buyer's business practices firsthand. A sales agent is known in the buyer's trade circle and has access to credit information from local banks and commercial sources. A sales agent can therefore offer a fair picture of the buyer's financial condition, as well as confidential data that would be difficult to obtain from any other source. Often a sales agent will have a personal relationship with a buyer contact, whether it be the owner or decisionmaker. An astute international credit manager recognizes that this relationship needs to be emphasized if he/she wants to obtain information and develop a level of confidence with the customer.TimelinessTimeliness is a particular issue with international credit investigations. In some cases the overseas credit reporting agency can take two weeks or more to respond. In that situation, a direct approach may be timelier and more appropriate. If you have ever read a magazine article or book on "what's going on in a particular county," you know that it is often already outdated material. In the time it took to get the information printed, circumstances may have changed. Online web resources, daily and weekly newspapers (The Asian Wall Street Journal or The Financial Times) are the often the answer for obtaining truly timely information. An astute international credit manager utilizes incountry accounting firms, lawyers, and bankers he/she has developed as resources of information. "People on the scene" usually are an excellent source for local news and information.CompletenessIt is rare that any credit report is truly "complete." Even if payment information, financial data, and antecedent information exists, an international credit manager may be unsure as to country conditions. Through experience, networking and education, an international credit manager can conclude what a "good" report is - often determined by the level of risk estimated; the value of the order; the need to meet sales goals; and the nature of the transaction, whether, for example, it is a onetime order or a lasting relationship (Exporting - From Start to Finance, Wells and Dulat McGraw Hill).SummaryThere are a variety of costs associated with gathering credit information. These costs vary based on the type of information you are gathering, the company and country you are gathering about as well as the ways you need this type of information. It is important for a global business professional to know where to get the information, the estimated costs and the time it will take to gather the information. For budgeting you must take into consideration the estimated costs to have a better feel for the overall costs of doing business in your global markets.
|
About Us | Terms of Use | Contact Us | Partner with Us | Press Release | Sitemap | Disclaimer | Privacy Policy
©1999-2011 OpenLearningWorld . com - All Rights Reserved