"Our work isn't easy. But what helps is that Atradius Collections is part of the whole collections process and strategy of BASF's credit management.
As part of BASF's efforts to improve accounts receivable management, a business decision was made to consolidate collections activities with Atradius Collections.
1. Make Atradius Collections part of BASF's collections process and strategy with orderly handover
"Our work isn't easy," says BASF's Credit Manager. "But what helps is that Atradius Collections is part of the whole collections process and strategy of BASF's credit management."
To make it work, BASF has implemented a new credit management guideline, stating when their credit managers need to consider handing over the outstanding receivables to Atradius Collections. The credit managers can postpone the handover, but they need to have a good reason for that. Why? "I know from experience that the longer you wait to hand things over, the more problems you have getting the money," says BASF's Credit Manager. His insight is reflected in the collections reports: the sooner Atradius Collections gets the receivables, the better they succeed in collecting them.
BASF has also made this handover known to their customers. They understand that if the payment terms aren't respected, their cases will be handed over to Atradius Collections. This awareness not only prompts the customers to pay on time, but also impels BASF's business units to be active in managing their receivables and working on disputed invoices.
That's why BASF and their shared services centres consider Atradius Collections more than a service provider, "Atradius Collections is a business partner and has actively contributed to our collections strategy."
2. Use Atradius Collections' expert knowledge of local payment practices coupled with a professional, case-by-case approach
Expert knowledge of local payment practices
With in-house, local collections experts around the world, Atradius Collections has benefited BASF's global accounts receivable management greatly. "Atradius Collections' knowledge of the local procedures and regulations expedites the collections process," says BASF's subsidiary in North America. BASF's shared services centre in Germany agrees, "Atradius Collections' comprehensive service portfolio and local resources allow them to solve special cases."
BASF's Credit Manager has seen many customers give excuses for not paying and think they can keep negotiating. It could be a dilemma between getting them to pay and retaining business with them. Atradius Collections has proved to be an effective solution.
"It helps when you have someone external contact the customers in a professional and business-like manner," says BASF's Credit Manager. "They come in objectively and this gives us good results. Usually after one letter from Atradius Collections, the customers paid the whole overdue amounts."
Next to that, Atradius Collections' flexible approach has been crucial to BASF's collections process. There were cases where BASF got informed that the customers weren't doing well. Sending letters or giving phone calls wouldn't make much sense. "You need to take legal action as fast as possible," says BASF's Credit Manager. "So we contacted Atradius Collections and they did it immediately, skipping other processes. It’s the case-by-case attitude that’s very important."
In regions where there are many disputed invoices and insolvent customers, Atradius Collections adapts by focusing on logging claims and solving disputes to improve BASF's accounts receivable.
3. Have transparent communication and strong support no matter how complicated cases become
Trust underlies the successful partnership between BASF and Atradius Collections. It's the result of years of transparency and support.
After handing over the outstanding accounts receivable to Atradius Collections, BASF remains in control and is well-informed. "The collections process of Atradius Collections is very transparent. We can follow every step on their online platform," says BASF.
If something comes up, it's handled quickly through regular exchanges and weekly discussions. "Open and transparent communication is very much appreciated. If Atradius Collections has something, they address it to us. If we have something, we talk frankly and openly about it," says BASF's Headquarters. "It's important that if there is something that doesn't work perfectly, we bring it up and not leaving it aside. Things can only be changed once they’re addressed in a friendly, smart way."
BASF's Headquarters believes that having such constructive and challenging conversations has brought about this effective collaboration, "We’d like to express our appreciation to Atradius Collections' account managers. They're doing a great job, and they walk the talk. The cooperation is successful and at a very high level. We're very happy with it and hope to maintain it this way."
Understanding BASF's accounts receivable needs, Atradius Collections can assist early and actively. "Collections of outstanding payments is a delicate and crucial part of any business. Having an experienced partner like Atradius Collections support us with their best practices is key," says BASF. "The advice and support provided by the team at Atradius Collections have always been great from the start until now. They're responsive and always there to assist. If a case becomes complicated, our direct contact with Atradius Collections also becomes very strong."
When being asked what Atradius Collections can do better, BASF's Headquarters and Credit Managers share the same opinion, "It's 100% perfect. If you attain a very high level, the only thing is maintaining it. So keep on working and maintaining it."
1. Streamlined collections process
By providing one point of contact, Atradius Collections has helped BASF streamline their collections process significantly. "We clean up ageing items and become more effective in our collections efforts," shares BASF.
2. Favourable collections results
So far Atradius Collections has worked on millions of euros in accounts receivable for BASF with very high success rates. "In most cases, a lot of long-overdue invoices handed over to Atradius Collections get paid after their first contact," says BASF. This has in turn improved other accounts receivable numbers substantially. "Atradius Collections gives lots of added value to us, such as bringing our DSO down to a very good level. It's beneficial to BASF," says BASF's Headquarters.
3. Customer retention
To BASF, a big advantage in working with Atradius Collections is that their business relationships are maintained. "Atradius Collections is an objective, professional, and business-like partner to contact the customers," says BASF's Credit Manager. "We see that whenever we hand over customers to Atradius Collections, they will pay. And when they pay, they keep being customers afterwards."