The Chartered Institute of Credit Management (CICM) has released a checklist for businesses in order to help with their cashflow, regardless of the Brexit outcome.
The guide challenges businesses to question how well they know their respective customers under four key headings:
- Goods and the supply chain
- Processes and contracts
- People and organisation
For example, it advises that businesses should consider whether their customers are dependent on raw materials from organisations in the EU, whether they will have to re-issue or re-negotiate contracts, or whether they are dependent on staff or skills that might become in short supply in a post-Brexit Europe.
It also advises businesses to assess how their customers might be impacted by exchange rate fluctuations, whether they will have to pay more to source existing supplies, and whether they operate with profit margins that are so small that even a slight increase in cost will have a disproportionate effect on their future well-being.
Philip King, the CICM’s Chief Executive, says that firms can mitigate the risks they face by asking some simple questions. He explained, “The credit manager’s mantra of ‘know your customer’ will be more important than ever as we head towards a Brexit conclusion.
“Asking the right questions early will enable you to put plans in place that will help you be better prepared for whatever outcome.”
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