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    Lesson 3&4

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    Chryss John Querol
    A franchise (or franchising) is a method of distributing products or services involving a franchisor, who establishes the brand's trademark or trade name and a business system, and a franchisee, who pays a royalty and often an initial fee for the right to do business under the franchisor's name and system.

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    Lesson 3&4

    Uploaded by

    Chryss John Querol
    44 views3 pages
    A franchise (or franchising) is a method of distributing products or services involving a franchisor, who establishes the brand's trademark or trade name and a business system, and a franchisee, who pays a royalty and often an initial fee for the right to do business under the franchisor's name and system.

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    lesson 3&4

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    A franchise (or franchising) is a method of distributing products or services involving a franchisor, who establishes the brand's trademark or trade name and a business system, and a franchisee, who pays a royalty and often an initial fee for the right to do business under the franchisor's name and system.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    44 views3 pages

    Lesson 3&4

    Uploaded by

    Chryss John Querol
    A franchise (or franchising) is a method of distributing products or services involving a franchisor, who establishes the brand's trademark or trade name and a business system, and a franchisee, who pays a royalty and often an initial fee for the right to do business under the franchisor's name and system.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
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    Chryss John Querol

    FM2 – Credit and Collection

    Lesson 3&4 Reflection Paper

    Credit investigations are one of the credit department's main responsibilities. The

    more effort put in at the start of the buyer/seller relationship to gather information, the

    easier it will be to collect accounts later.

    Within the organization, the information gathered during the investigation must be kept

    private. It is necessary to establish a policy regarding who has access to credit files.

    This policy should be tailored to the size of the organization, the scope and nature of the

    data in the files, and the intended use of the data. By unwarranted or unguarded

    revelations of information that the customer might consider detrimental to the company's

    reputation or character, an untrained person could seriously jeopardize the relationship

    between the customer and the company, and even expose the company to a lawsuit.

    Direct investigation occurs when a creditor obtains credit information directly from the

    customer or indirectly from noncommercial sources of information such as competitors

    and other trade references who may have relevant information to share. Direct

    investigation sources include trade references, bank references, and financial

    statements provided by the customer; information obtained from a Secretary of State's

    office; information found in public records; details gathered through personal or

    telephone interviews with principals; and material found in search engines such as

    Google, Yahoo, and others, as well as the customer's, or potential customer's, website.

    Customer visits offer numerous opportunities to strengthen customer relationships.

    Representatives from credit, sales, and other levels of management may pay you a
    visit. Joint customer visits may have the added benefit of improving internal

    communication between sales, credit, and other departments involved in the account's

    maintenance. A customer visit sends a clear and consistent message to the customer

    that the creditor values its business and that there are certain expectations for doing

    business with the credit grantor. A good customer visit should be educational in terms of

    both the creditor's and the customer's expectations.

    Observing the customer's operations first-hand can teach you a lot. An astute credit

    professional will notice any discrepancies or inconsistencies in the information the

    customer has previously provided. A recent financial statement, for example, may show

    a large amount of inventory on hand. During a facility tour, if inventory appears to be

    low, the credit professional can point out the discrepancy and allow the customer to

    explain. Customer visits help to break down barriers to customer understanding. Many

    privately held businesses will only allow financial data to be examined on site. In such

    cases, the credit department would be unable to access financial information if there

    was no visit. In these situations, it's critical to gather as much data as possible during a

    customer visit. Take notes if the customer allows it.

    First, the credit professional may now be able to see the assets. Second, unlike a phone

    conversation, the review usually has more unrestricted time allocated to it. This gives

    you more time to ask clear, concise questions and watch how the customer responds to

    specific questions.

    A visit allows the credit manager to learn more about the components of the customer's

    cash flow, which is especially important if the balance sheet analysis indicates a

    problem. The credit manager can determine and monitor whether inventory or accounts
    receivables are turning in a normal range for the industry and/or the current economy. A

    discussion of the customer's account status and the collection of payment for past due

    accounts may be part of the customer visit. Preparation is crucial; the credit professional

    should have all relevant facts on hand and be well-informed prior to the discussion.

    Because the topic may be sensitive, a sales or manufacturing representative may be

    excused from participating in this part of the meeting.

    An appraisal is the most accurate way to determine the fair market value of your home

    based on its location, condition, and recent sales of similar homes in the area. An

    appraisal not only gives you an estimate of how much your home is worth, but it also

    tells you how much you can borrow from a lender. The purpose of a home appraisal is

    to provide an accurate estimate of a property's value. This valuation is critical for a

    mortgage lender because it ensures that it is not allowing homebuyers to borrow far

    more than the home is actually worth. A qualified appraiser creates a report based on a

    visual inspection, using recent sales of similar properties, current market trends, and

    aspects of the home (e.g., amenities, floor plan, square footage) to determine the

    property's appraisal value.

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