Techniques to help Obtain Financial Statements
When a customer refuses to provide them
We are having trouble getting Financials from some of our customers.
Are there some techniques out there to help obtain these when a customer
refuses to provide Financial Statements?
"WE DON'T DISCLOSE FINANCIAL INFORMATION" is a phrase every credit manager
has heard. Don't Give Up! Find out who makes the ultimate decision and
specifically why they don't disclose. Some reasons could be . . .
- Offer to sign a confidentiality agreement. Assure
customers that financial information is used for credit purposes only
and no one outside the credit department will view the statement.
- Agree with their concerns, "I know how you feel,
we don't disclose financials either, but eventually there are a few
key business partners with whom we have to share financial information.
Reassure customers that you hold financial information in the strictest
of confidence.
- Ask for partial disclosure. Gathering information
such as key ratios and tangible net worth can paint the picture you
need. Once they start talking, they will usually tell you more than
you would imagine. Be prepared! Know which ratios and information you
want before you ask!
- Ask if a financial statement can be reviewed on site?
Go in with a game plan and know what information you need. Take notes
and calculate ratios.
If all else fails, hold your ground. Ask customers what they would do
if the situation was reversed. "What would you do in my position?"
Be prepared to graciously back down, thank them for their time but
hold your ground.
Repeat same steps next week! Credit management is like playing chess.
Keep your objectives in mind, develop a strategy, keep the goal in site
and play the game.
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