Carsales’ collections team needed more control over outstanding payments. To do that they had to develop a more detailed understanding of the payment behaviour of their customers so they could reprioritise collections and improve their accounts receivable position.
By performing a CreditorWatch portfolio health check, Carsales was able to identify the customers that posed the highest risk of non-payment. They were also able to tidy up their customer list by consolidating duplicate accounts and removing outdated information.
CreditorWatch’s DebtorLogic enabled Carsales to analyse the payment behaviour of customers and identify who the riskiest debtors were on an ongoing basis.
As a result, Carsales was able to isolate the customers that could pay on time but weren’t, and assign a dollar value to their risk exposure – how much revenue were these delinquent paying customers costing them.
Carsales has reprioritised its collections which has given the collections team a better focus and improved the collections rate.
Consequently, it has reduced its Day Sales Outstanding (DSO) by 25%, a significant boost to accounts receivable and the bottom line.
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