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Professor is it fine if Sales director authorises CREDIT CHECK/does the check herself? I agree that sales staff shouldn’t be allowed to do the credit checks as they will always be biased and suggest that higher credit limits should be set. But what about letting the sales director do that?
it should always be an external credit agency who should check the solvency of the customer?
Obtaining a reference through a credit rating agency is a routine task that does not merit the time of any senior employee. Before a new major customer is given credit they would expect a supplier to obtain references (and even provide a copy of their last audited financial statements or other evidence of solvency). Once the information has been obtained, individual sales managers might have authority to approve new customers up to some specified $ amount. Then above that amount, the sales director’s approval must also be obtained.