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Mar 01 2018
Strengthening the Credit and Sales Partnership
Treva Edwards, Sunroc Corporation
To me, the credit department and sales department have always seemed to have a love-hate relationship. I have seen the conflict that can arise between the two departments. Both departments have different jobs, functions, agendas and goals. People understand what their responsibilities and job duties are and are protective of it. This is where the conflict comes in. The sales department is willing to do whatever it takes to make the sale, all while the credit department is doing everything that it can do to protect the company from credit issues. Both departments are necessary to a company, but they do not always agree on what needs to be done.

I have asked myself many times "Why do we have all this conflict?" It should really be so simple because we should all be on the same team.  I used to believe that it was because of personality differences, but after reading up on credit and sales partnership in Principles of Business Credit, I realize there is so much more to it than I thought.

A salesman's main objective is to build customer relations, make a sale and create revenue for the company. A salesman must always be building relationships with potential customers as well as strengthening current ones, so customers can be retained. It is not uncommon for a salesman to feel a sense of self-importance as they are in part responsible for creating revenue for the company. Most often salesman feel that their job is done once the sale is made. However, as we know, a sale is not a sale until it is collected. And that is where the credit department can help.

The credit department's main objective is to act as an agent of the company, processing credit applications, making sure that any potential customers are not a credit risk and creating credit policies that protect the company from a negative outcome. They are, in essence, caretakers of the company's investment.

The dynamics of and between the two departments and the work the it takes to create a solid working relationship for credit and sales to work together is sometimes difficult, but it is possible. For this partnership to work, The C's of the credit and sales partnership need to be kept in mind. The C's of a good credit and sales partnership are Communication, Collaboration and Cooperation. 

The lines of Communication are always important, and communication between the sales and the credit departments can impact the growth of revenue and retention of customers. When Collaboration is used the departments work together to find the right credit terms for a customer or situation, thus improving profit margins and increasing sales volume. They can also work together to collect payments in a timely fashion and achieve sales goals. This process builds solid relationships between the company and customers as well as the sales and credit departments. Both departments have insightful information that can help each other accomplish the goals of the company. Cooperation is truly the key to this relationship. Working together instead of against each other provides the maximum growth for the company. Cooperation also puts everyone one the same page of understanding that a sale is not complete until final payment is made.

By following the 3 C's of the credit and sales relationship I believe that credit and sales departments can help each other better understand both departments views. This will help both departments come up with solutions to build a stronger team and thus avoiding conflict. The 3 C's change the dynamic from competition between to cooperation amongst departments. A strong partnership between the sales and credit teams equates to greatness for the company.