ApplyEasy Credit Management
3 mins read

Wholesalers face risks from poor credit application procedures

In the current economy, there are uncertainties and risks around every corner when it comes to running a wholesale trade business.

CreditorWatch’s July Business Risk Index (BRI) indicates that the average probability of default (PoD) in the wholesale trade industry is at 3.6 per cent, with smaller operators in this sector set to be more quickly impacted by late payments and reduced demand. As of June 2022, 8.5 per cent of businesses are in 60 days arrears or more, a rise from the previous month, indicating signs of distress. Wholesalers are often caught without any means to protect the livelihood of their businesses as tensions in supply chains increase.

As businesses in the wholesale trade industry continue to operate in times of uncertainty, their exposure to credit risk increases. This places added pressure along the supply chain and leaves wholesalers, and their trading partners, at a higher chance of defaulting or becoming insolvent.

As a wholesaler, there are always going to be risks involved when taking a new customer onboard, so it’s important that you have strong credit application procedures in place to properly protect yourself before you sign a contract. This will ideally eliminate the need for debt collection down the road. If you are unclear about who you are working with and their capacity to pay off debts, you run the risk of crippling your businesses cash flow, and leave yourself at higher risk of insolvency, unable to recover the money you are owed.

This is why it’s especially important to ensure you’re working with financially stable customers. And the best way to achieve this is to strengthen your due diligence and implement robust company credit check procedures when onboarding new customers.

ApplyEasy Strengthens Credit Application Procedures

To help you mitigate risks and strengthen your credit application procedures, CreditorWatch has a suite of tools that can be added to your arsenal at any point. With ApplyEasy, you can transform your credit application process into an online form which simplifies the process for your customer and enhances your overall internal credit process.

ApplyEasy is completely automated and eliminates the possibility of handwriting being illegible in applications, reducing processing times to approve an application by 50 per cent. Automation also allows you to check and validate information in real time, and easily manage the approval and rejection process with a direct response through the dashboard.

ApplyEasy’s auto-decisioning feature determines whether an application will be approved, referred or rejected based upon a set of rules you set up. These rules can be customised for your business depending on the industries you work with, credit limits and types of products or services you deliver. For example, applicants with past, present or upcoming court judgements could be set to “reject”, while those who have been trading for less than six months could be set to “refer”. Each applicant automatically undergoes a credit check which contributes to the final outcome. This streamlined customer acquisition process means you can make quick and accurate decisions around customer onboarding and credit management. 

ApplyEasy also checks and validates all new customers’ data in real time. Integrated with ASIC, ABR and the CreditorWatch credit bureau, ApplyEasy populates details as they fill out the application. Automated applications can be passed on to team members for quicker checks and approvals, with each step recorded with an audit trail and notes specific to the customer.

ApplyEasy helps wholesalers protect their cash flow and make the right decisions well before they sign any contracts. This is especially crucial in the current economy.

Interested in ApplyEasy? Get a free demo now

CreditorWatch helps wholesalers manage the risks in their business transactions – thousands of businesses have benefitted from our solutions. To improve your credit risk management and streamline your credit application procedures, contact us now for a free demo of ApplyEasy.

Communications & Marketing Coordinator
Bridget joined CreditorWatch as Coordinator of Communications and Marketing in June 2021. She is passionate about developing and communicating content that assists businesses of all sizes to be supported and protected to grow.
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