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| Debt levels rise among communications companies | (09-Apr-03) |
9 April 2003: ACCORDING TO the results of a survey released this week by UK-based management consultant SECOR Consulting, more than one third of communications companies worldwide believe that debt levels are rising even though increasing attention is being paid to credit management issues.
SECOR’s ‘Global Communications Industry Credit and Debt Management Survey’, conducted among finance directors and credit managers from communications companies around the world, highlights that whilst communications organisations are trying to overcome debt problems and increase revenue optimisation, there is a clear need for benchmarking to be introduced into the area of credit and debt management.
The survey has identified that the most significant causes of debt are operational ones, notably billing errors and queries, followed by delays in query handling. Finance issues, such as customers’ inability to pay, are the second largest overall cause of debt, with credit process issues coming in third. Furthermore, 9 per cent of respondents to SECOR’s survey admitted to not carrying out credit checks, while 36 per cent of those with credit policies admitted to not adhering to them and 30 per cent to not utilising online vetting to ensure speedy, stringent checking.
“The results of this survey underscore a very real need for better credit and debt management,” said Richard Brown, senior principal consultant at SECOR. “It is not surprising that debt is rising with such a lack of clarity in policies. The communications industry needs to review its processes drastically if it is to improve debt levels. For example, it is vital to have a clear credit policy in place as a control function over credit and debt management, but it is also equally crucial for the sales and marketing teams to adhere to the policy.” |
| For more information about this item, please contact: |
| Name: | James Gilmour |
| Company: | Credit Risk International |
| Phone: | +44 (0)20 7089 5264 |
| Email: | james@crimag.com |
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