If I may, I would like to ask the group a question: What is your credit review process regarding customers in Mexico? I am trying to figure out how best to conduct a credit review regarding Mexico accounts and very much appreciate any help you can provide.
Best Regards, Craig Combs, KYR Financial Services LLC
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We set up the majority of our new accounts as PIA until we have established a working relationship with them. We also rely heavily on our sales representatives that we have in locally in that region. They are usually able to offer helpful insight about the stability of the customer.
Ashley Hernandez, Credit Manager, Columbia Machine Inc
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We ship into Mexico either:
- Credit Insured with terms (I would not recommend open terms if you can avoid it)
- CIA
- Or on the rare occasion we do extend some risk, but it max's out at $25K USD/500K Peso and the acct has to remain prompt on net 30 days at all times or orders go on hold
Rosa Ferraris, A/R, Credit & Collections Manager, DeLonghi America Inc.
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As we all know Mexico is a different animal regarding credit intelligence and is not far behind China for obtaining meaningful credit intel. We utilize D&B, CreditSafe, and Kreller Group and also rely heavily on what our sales folks know about the customer (business, end customers, markets, products, etc.). Knock on wood…we have had little or no bad debt over the years. Generally, we offer open terms provided we have reasonably good insight from the aforementioned sources and have never had to resort to securitization.
Bruce B. Galletly, Director of Credit, Teknor Apex
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We don't do business in Mexico. If there's a special request it is done as prepay wire transfer.
Deb Kissel, Credit Manager, Lafayette Blinds
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Our business in Mexico is limited to companies that are subsidiaries of a US company.
Kate Delaney, Credit Manager, Sterilite Corporation
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We do sell open accounts in Mexico, however, we always backstop those sales with credit insurance. Those sales are a combination of rail and vessel sales. Our main tool for credit evaluation is to require financial statements. If a customer will not supply financial statements, we require some form of prepayment/cash in advance.
Our International Credit Manager (ICM) does order credit reports, but to be honest that is more to further evaluate the company and ownership structure and less for making a credit decision. The (ICM) converts the financial statements to US dollars and also translates important notes using free online currency conversion tools and google translate and then spread the financial statements. From there the ICM breaks down the balance sheet, income statement, and cash flow statement to uncover how the company is doing. Customers with credit guidelines over $1 million require a write-up that includes financials, ratio analysis, interpretation of results, and a recommendation. Our ICM also prepares a country risk assessment based on macro and microeconomic data and updates the specific political issues in the country as well.
We follow the same formula for all International sales.
Lawrence T. O'Brien CCE, ICCE, RGCP, Sr. Director, Global Credit, Nutrien
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