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Sales and credit, one team ?

Sales and credit, one team ?. Reality or myth ?. Topics:. Chevron Phillips Chemicals at a glance Product range EMEA Credit Organization Scoring System Collection Activities Conclusion. Company formed in July 2000. About Us.

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Sales and credit, one team ?

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  1. Sales and credit, one team ?

  2. Reality or myth ?

  3. Topics: • Chevron Phillips Chemicals at a glance • Product range • EMEA Credit Organization • Scoring System • Collection Activities • Conclusion

  4. Company formed in July 2000

  5. About Us • Manufacturer of petrochemicals that are essential to manufacturing over 70,000 consumer and industrial products • At end of 2012 : $9.4 billion in assets and more than $13.3 billion in annual revenues • Trusted supplier to customers in more than 125 countries • A highly educated & diverse workforce of approximately 5,000 employees working on five continents across the globe

  6. Manufacturing Locations Belgium United States South Korea Saudi Arabia Qatar China Colombia Singapore

  7. Global Significant Projects – Middle East SAUDI POLYMERS Company – saudiarabia Q-CHEM II – qatar

  8. 2012 Sales & Assets

  9. End Uses • Adhesives and Sealants • Agricultural • Appliances • Automotive • Building and Construction • Chemical Manufacturing • Dry Cleaning • Electronics • Healthcare • Household • Imaging and Photography • Industrial • Lubricants • Oil, Gas and Mining • Packaging • Paint and Coatings • Personal Care and Cosmetics • Pharmaceuticals • Pipe • Plastics and Rubber • Solar Panels • Textiles

  10. EMEA Credit Organization & Strategy • Team of 4 people • Global exposure control via SAP FSCM • Unique financial scoring (implied rating) • Best practice sharing with US & Asian colleagues • Involve sales in collection activity • Tight follow-up on overdue invoices, order blocking when invoice 5 days late • Sales person takes ownership of unpaid debt • Monthly meeting with product line manager on default accounts

  11. Implied rating Uniform rating system on corporate level *When scores fall in more than one category, give more weight to the Coverage ratios.

  12. EMEA Customer Portfolio Profile CCC Not rated AAA Secured AA Speculative grade : 22% B BB A BBB Investment grade : 70% Investment grades : AAA, AA, A & BBB Speculative grades : BB, B & CCC

  13. Collection Activities • Weekly dunning letters by email or fax • Mid-month statement of account by email (all outstanding invoices are mentioned) • SAP Credit check indicating overdue situation when new order is entered

  14. Collection Procedure Overdue of:

  15. EMEA Credit and Collection KPI’s Key Performance Indicators EMEA (year 2012) • DSO 38 days • Delinquency 1 day • Collection Efficiency 96 % • Overdue at month-end < 3% • Annual write-off < 0.1 Pro Mile

  16. Tools of Success • Strong communication and mutual support between credit and sales “salesare our eyes and ears on the field” • Involvement of sales in the collection activity and ownership of unpaid debt • Tight follow-up on overdue invoices • Control on payment terms > risk control • Financial training provided by credit to sales’ force

  17. Sales & Credit = one team & it works!

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