It is easy to think that once you have closed a sale, you can relax. Far from it. Often, shaking hands is simply the first in a series of steps to ensure the deal goes through smoothly.
Firstly, remember to enter the sales negotiation armed with information. If the value or risk of the business transaction is high, it's wise to get as much financial information about the client as possible, to minimise the level of risk to the business and protect against bad debt.
Closing the sale is not simply a matter of asking for an order; establish terms of delivery and payment. Restate credit terms to the buyer and present them with your credit application form. Establish a named contact responsible for payment.
For very small orders, a credit report may be uneconomic and you may wish to take the risk yourself. However, for significant orders, buy a credit report. Bank and trade references should always answer specific questions such as; can I grant £500 credit? Or what proportion of this firm's payments to you are overdue? However, bank and trade references alone should not be relied upon.
Decide on a credit limit. A credit reference agency may recommend one or do it yourself, deciding whether a firm is a high risk, a late payer with adverse information such as county court judgements against it or dubious individuals involved; or low risk, with a good payment record and good credit references.
If you decide to grant credit, set up an account and write to the customer confirming this.
Always have delivery confirmed with a delivery note and follow up with a phone call, confirming that delivery was satisfactory. Invoice immediately, restating credit terms, and quoting an order number if appropriate.