Alejo Lopez Casao
Empresologo | Credit and Operations Director
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Do you know your customer?

23/11/2015

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Do you know your customer?
  Do you really know your customer? Sure it happened to you..." the (loan) application is being analyzed by the risk department" or " the risk analyst is looking at your case right now.." and you get an image of a bunch of (freaky) people crunching numbers and statistical data in their laptops without even knowing the name of your company or what do you do... or what do you want the money for...


(see it on Linkedin)
And it should not be like that!  In fact, the analyst should be part of the front office along the sales person... they should visit the customers and get first hand impressions of the customer.
Customer visits are invaluable to the credit analyst as a means to clarify and to supplement the information made available by the customer and the sales person. The focus of the customer visit is, of course, an interview with an officer or officers of the company under review. Frequently, it is possible, and may be desirable, to supplement the interview with an inspection of the company’s operating facilities. .
The analyst should approach the interview with the primary objective of obtaining answers to the questions, which have arisen during the initial investigation of credit information. The purpose of the customer visit should not be for additional news or initial information gathering.
Before making the visit, it is essential that the analysts examine thoroughly and analyze carefully all information made available and/or published information on the company. Its annual and interim reports, product brochures, equipment information, receivable lists, suppliers, commodity pricing, major customers, major projects and backlog, and all debt obligations should be obtained and reviewed. In addition, it is advisable to seek any additional information on the company or its industry, which is available by statistical services, in reports by industry associations, trade publications, and by government agencies.
The analyst should obtain a good working knowledge of the company, its products, markets, industry standing, financial history, and the nature of competition, potential industry problems, and the company’s strategic aims. At the same time, the analyst should develop questions as to “why” certain events have happened, and “how” the company’s financial record and present financial standing developed. To obtain optimum results from the facilities visit, the analyst should make a complete listing of all inquiries to be made and organize those inquiries in logical sequence to cover each area of interest and to expedite the investigation. A carefully organized interview featuring precisely worded questions and a minimum of generalizations, stands the best chance of getting the full cooperation of the customer, because it reveals professionalism to have “done your homework.” .
The analyst should be able to better understand  (a) the demand for its products or services; (b) the prices received; (c) the direct and indirect costs; and (d) the requirements and means available to finance its operations. A clearer picture may be obtained of the manner in which the company’s product mix, operating procedures, and financial policies are similar from competitors and why, and then discuss the company’s strengths and weaknesses.
If the facility visit also includes an inspection of the company’s operating facilities, possibly there will be some opportunity to observe if operating policies and controls are being implemented as intended. It is usually pertinent to discuss the company’s long-range planning and the direction of its research and development work, if applicable. Also, inquiry can be made about technological, market, or other developments, present and potential, which may have significant influence on demand for the company’s products or services, or on their prices and/or costs. Finally, it is conceivable that from the facility visit the analyst can begin to obtain some basis for evaluating the caliber of the company’s management.
In evaluating the information obtained from a facility visit, analysts should take care to check and recheck for possible errors or misunderstandings if their findings appear to contradict published financial data.
And then, make a recommendation based not only on numbers..



from Alejo Lopez Casao - Blog http://ift.tt/1Xh99kt

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October 20, 2015 at 01:11PM
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    Licenciado en Empresariales soy por lo tanto un empresologo...y he trabajado como morosologo, analista,...

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