While I was the CFO at Magnolia Coca-Cola, we
changed our policies to give every new restaurant and bar credit terms—no
questions asked. But we controlled our
losses by setting a small credit limit that forced them to pay our bill in
order to get the second or third order.
Our Pepsi competitor didn’t give credit to new customers, so we picked
up all the new business.
My experience was that new sales far outweighed
the bad debts and helped give us a ton of goodwill with businesses. Because we had trusted them from the very
beginning, they remained very loyal customers.
QuickBooks can help you control your outstanding
receivable balances by setting credit limits for each customer. Once you do, you and your staff will get a
warning any time you try to record a new invoice that would bring their
outstanding balance above the credit limit.
You can then decide to approve the order and/or call the customer to
arrange payment at the time of delivery
Check out this screen capture that shows how easy it is to setup credit limits in QuickBooks http://youtu.be/cEYAaEBGuzQ