Comprehensive credit policies should cover several key areas:
Credit Terms: Define the payment terms, including due dates, early payment discounts, and late payment penalties. Credit Limits: Establish limits based on customer risk profiles, purchase history, and financial stability. Credit Application Process: Outline the steps for new customers to apply for credit, including required documentation and evaluation criteria. Collections Policy: Detail the procedures for handling overdue accounts, including reminder schedules, collection efforts, and potential legal actions. Review and Monitoring: Specify how and when credit limits and terms will be reviewed and adjusted based on customer performance and market conditions.