One of the first excuses for not using trade credit insurance is the added cost. True, you will have to spend money on the policy, but as the old adage goes “you have to spend money to make money”. In all reality, trade credit insurance should be looked at as an investment in your business. It supports your accounts receivable team and protects your business from the possibility of large unforeseen losses.
The best way to put this investment into perspective is to look at the ROI. Trade credit insurance offers more than just a guarantee you will collect what is owed to you on time. Once your business is no longer worrying about whether they can actually keep their cash flow coming, you’ll have the opportunity to sell more and at larger rates. This snowballs into a huge growth opportunity for your company.
Below is an example of how a company might realize ROI on trade credit insurance