Fast analysis of large credit line decisions.
$400+ Million Annual Revenue
A large IT service company was having issues with their credit insurance provider and wanted to consider alternatives without exposing their company to unnecessary risk. They required quick responses on large credit lines in order to fill orders quickly in a very competitive environment. The credit insurance provider was not able to provide their responses in a timely fashion, creating stress within the sales department and management. They came to Axim seeking a solution.
Client Pain Points
The company was concerned with the amount of time it was taking the credit insurer to provide responses on credit lines in excess of $1 million and believed that more timely responses were critical to their sales goals. They lacked the in-house expertise to analyze the credit worthiness of their customers for credit lines of this size and needed a credit manager or outsourced service to provide this function on an ongoing basis.
Axim discovered that approximately 85% of their client base was comprised of public companies. Therefore, quarterly financial statements were available–a requirement due to the size of the credit lines they were seeking. Through discussions with upper management, we agreed on a solution that included a comprehensive examination of their customers, credit line recommended amounts, and a memo outlining the pros and cons of each customer. Due to our management team’s 40+ years of experience, the client decided to forego the insurance policy and accept Axim’s recommendations on all active and future customers. A process was set up to easily assign lines to customers requiring small credit lines and a tailored solution for reviewing and reporting on customer lines in excess of $1 million up to $20 million. 3-day review timelines were established for large credit lines.
Axim’s services have been very cost effective for the client. By working with us, they reduced expenses by 40% with a turnaround average of 1-2 days, when compared to the credit insurance policy. The majority of their account base has been accommodated with the credit line amounts requested. During the 8 years they have used our services, there have been no credit losses on public companies and only one loss taken on a private company, for a nominal amount.