It’s often said the sale is not complete until the bill is paid. In spite of this popular aphorism, too many salespeople treat the credit department as a necessary evil, some calling it the “sales prevention department.” They incorrectly believe their role is to advocate strongly for contractors, failing to realize that the successful transaction is not only a delivery, but also a final payment.
Put this in perspective by envisioning the auto salesperson who argues passionately for credit to an uncooperative buyer for a new car. “I know this guy and he’s good for it,” says the salesperson. If the credit manager expresses concern, the salesperson defensively complains that the manager doesn’t understand the challenges of selling. If this sounds ridiculous, remember that building material salespeople have a similar conversation on behalf of contractors every day in our industry.
Salespeople fear the aggression of uncooperative buyers who are unwilling to share their financial statements or sign personal guarantees. They fear losing an order and argue passionately on behalf of the buyer. This same salesperson wouldn’t think twice about being scrutinized closely before receiving credit for the same dollar value, but somehow feels credit should be extended to a contractor with minimal scrutiny.
Great sales leaders, on the other hand, treat credit as an integral part of the sales process rather than an obstacle to success. They are confident that good customers understand the importance of discussing payment terms. Sales leaders produce credibility within their organizations by being the ones who handle the delicate subject of credits and payments with grace and efficiency.
Here are four tactics that will make you a stronger sales leader and manager of credit.
- Change your mindset. Credit is an “expectation” that contractors assume is part of the service. It is up to the salesperson to convert this casual expectation into a serious dialogue. Remind buyers that you are taking a significant financial risk with every delivery. Maybe the best sales pitch is to say, “You wouldn’t expect a bank to give you a loan on a house without an in-depth review of your finances, would you? So help me to help you communicate with my team and get you the credit you need.”
- Formalize delivery of the credit application. Salespeople have long been taught to casually “drop off” a credit application early in the process. Instead, try scheduling a meeting to formally discuss credit review, payment terms, and your client’s expected financial needs. This creates a great sales dialogue about potential volume and future business while also clarifying expectations down the road.
- Own the collection conversation. Instead of lamenting the negative feedback about the collection conversation, take ownership of that conversation to minimize conflict and sustain your future business relationship. You are the salesperson and have the best skills to handle a buyer’s negative emotions.
- Sell what you got! The best credit relationships occur when you get customers to pay within your standard terms. I’ve worked with dozens of dealers who offer far too many special exceptions to their standard credit terms. Great sales leadership is not creating a new rule for every customer, but instead getting them to do business within your standard terms.
If you want to create customers who enjoy working with your credit department, then take ownership of the process. It’s the path to credibility with customers and within your organization.