1. Who gets what business credit terms
Let’s be smart about this, a credit policy doesn’t mean open the floodgates. The best customers, with the greatest ability to pay should have the best terms. New customers that have not established trust yet, perhaps not so much.
2. Factor in the relationship
Has the customer been consistent and loyal, there’s a good candidate for whom to extend debt. Loyalty when extending SMB debt goes a long way.
3. Credit Reports!
The best way to know if your customer is creditworthy? Pull the credit report. Business have credit reports as well, there are multiple business rating services out there, however Dunn and Bradstreet has a fair bit of industry credibility.
4. Risk Taking
Evaluate your client’s patterns of taking credit risk, either through review of their credit rating, or based on your personal knowledge. If the customer displays high degrees of credit risk taking,, it may not be in your best interest to extend them business credit.