Of course, you do everything you can to make the right decisions within your company and to achieve the best possible results. But ask yourself:
“Do the companies I work with do the same? How to know this?”
Request a credit report but not only
You are only able to make the best business decisions when you are aware of the most relevant and real-time business information. Therefore, a credit check should certainly not be skipped. But is a standard credit check enough? We don't think so.
To ensure that you do business with companies that are indeed in good financial shape, are reliable, run minimal financial risks and take the right decisions, it is much smarter to dive deeper into the due diligence process. There are solutions that go way beyond a regular credit report, making your company compliant and protecting your organisation against negative external influences. You can finally focus on growing your business!
A 360° view and irregularities in sight
Up-to-date and real-time knowledge about the companies you do business with is essential, but the Know Your Customer (KYC) process goes much further than just knowing who they are and what they do. It is just as important to also know who your customers are doing business with: this is your second-degree network. Also, an overview of all irregularities can also show whether there are indications of fraud, or any other problems that you would rather avoid dealing with.
Making well-founded decision is therefore, only completely reliable with a 360° view. In addition, it is important that a company's first and second level connections are examined for unusual situations and irregularities so that you can understand the extreme fluctuations in the company's financial figures.
However, all information that is not mentioned in the company brochure, but which is essential in the establishment or maintenance of a collaboration: business operations, are also just as important. Changes in management after a change in company form, or the takeover of bankrupt parts of another company are crucial pieces of knowledge.
The impact of COVID-19
Due to the coronavirus crisis, another point has been added in the past year.
“To what extent does COVID-19 affect your new and – at least as important – existing customers?”
You need insights into the consequences of the coronavirus crisis for the company in question. Where you previously had full confidence in certain customers or suppliers, these have suddenly become much less stable or even got into serious trouble since the health crisis, with all the consequences it entails. In addition, it may be even more difficult for new customers to get a clear picture of their business and prospects.