Optimising order-to-cash: a guide for trade creditors – Part 7
Part 7: Summarising our Optimising Order-to-Cash (O2C) series
In our Optimising Order-to-Cash series, we’ve seen that efficient and effective management of the O2C process is crucial for trade creditors as it impacts cash flow, working capital, and customer relationships. Having accurate and up-to-date data, as well as robust credit management practices, is essential for optimising the O2C process and minimising risks in the UK commercial lending market.
In our blogs, we’ve looked at:
- Data cleansing – the foundation of effective credit management
- Using data to balance portfolio growth and risk exposure
- How automated decisioning systems can improve efficiency across the O2C process
- Getting the most out of your existing portfolio by spotting and acting on opportunities and risks
- The importance of maintaining a KPI strategy for trade creditors in the UK commercial lending market
- Effective dunning for trade creditors in the UK commercial lending market
So, what’s next?
Understanding your customers’ payment performance is crucial for making informed credit decisions and getting paid quicker. Analysing your own sales ledger data without comparison to other creditors experiences may provide limited and an incomplete picture of a debtors circumstances which can leave you vulnerable to bad debt.
That’s where sharing commercial data through the Payment Performance Programme from Experian can make a difference. Trade creditors can better understand customers and their payment behaviour, leading to more informed credit decisions and quicker payments. Currently, over 1.5 million business reports with payment data are included in Experian’s database, covering 13 million accounts and £7.6 billion worth of transactions processed each month.
About the Payment Performance Programme
Our Payment Performance Programme is a reciprocal data-sharing programme which encourages businesses to share their sales ledger data to help creditors collectively better understand customers and their payment behaviour, in order to make more informed credit decisions and encourage quicker payment.
Our Payment Performance data forms part of our Commercial Bureau, the largest source of payment data on UK SMEs. The data is processed and refreshed on a monthly basis and covering all business types and industries to give an up-to-date view of UK businesses and how well they pay.
How does it work?
In return for your sales ledger submission, we provide each participant a detailed “days beyond terms” (DBT) report containing all your customers details along with the days taken to pay your company compared to the collective Experian DBT score and recent trends. This insight is invaluable in helping you better understand your customers, to make more effective decisions and focus your efforts on the right customers.
Did you know?
Businesses who share their sales ledger data, on average reduce their Days Beyond Terms by 3.9 days within 12 months.
Plus, as a Payment Performance member, you can also get access to more predictive risk scores, including Commercial Delphi Gen 6 – an industry-leading risk score which combines a business’ current account turnover data, existing credit relationships and the director’s consumer information to provide an accurate, predictive view of the businesses level of risk.
How to get started
To participate in the Payment Performance data-sharing programme, you need an active electronic sales ledger (SAGE, Kerridge, JD Edwards and Pegasus etc.) and commit to contributing customer name and address file and either an open item sales ledger download or aged debtors’ analysis a minimum of once per month. A technical specification document can be provided to help with this. Our Data Partner Managers will need to review and validate your data to your customers’ payment data is being interpreted accurately and fairly before implementation into the live systems.
All sales ledger data is treated with the utmost confidentiality. Transfer of information to and from our participating members is only conducted on Experian hosted secure platforms. In regard to legislation Payment Performance is data protection approved as long as members include the ‘Right to share data with credit reference agencies’ within their website Privacy Notices. The identities of data partners are not disclosed within Experian Products.
How can we help?
Payment performance is the largest source of commercial payment data, designed to help trade creditors better understand their customers to make more informed decisions and get paid quicker. Get started by emailing us today.
Further reading
Optimising Order-to-Cash: A Guide for Trade Creditors – Part 4
Regularly reviewing your portfolio and better understanding your exposure has never been more important for trade creditors. Find out more.
Optimising Order-to-Cash: A Guide for Trade Creditors – Part 3
Automating decisioning systems can improve efficiency across the O2C process. Find out how Experian can revolutionise your business' credit control process.
Optimising order-to-cash: a guide for trade creditors – Part 6
We've spoken to credit decision-makers and underwriters to identify their core challenges and discuss strategies for effective dunning. Read more.
Experian Affordability Update: Autumn 2024
In this report, we look at key affordability trends in detail, providing insights on specific customer segments and areas of the UK. Read more.
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1.5 million business reports with payment data included
13 million accounts
£7.6 billion worth of transactions processes each month