Currently we put customers on credit hold if they have late invoices, and invoices go out after we ship product. This results in a bit of a chicken and egg problem where for customers that are prepay terms and don’t pay we haven’t shipped anything, so we don’t have an invoice, so they aren’t on credit hold. Intuitively I think the answer is simple if terms are prepay then we should invoice before we ship product, and if the customer doesn’t pay they go on credit hold. Is there anything preventing us from invoicing a customer in this situation?
Why not start everyone on credit hold that doesn’t have credit terms? They can pay with a credit card at the time of sale or shipment.
Hi Eddie,
We start with almost all customers on credit hold, per finance preference. If prepay, then an advance billing invoice is done and the credit hold on the customer remains until payment received. For non prepay, a credit review is done as needed, and then we invoice upon shipment. We’ve made a report to be reviewed weekly for the advance payment orders. Here’s an example of a customer with an outstanding balance due before we plan to ship.
Nancy
And Advanced Billing invoice is used to invoice an order prior to shipment. The status of any Advanced Billing invoices related to an order could be used in a BPM to stop a shipment.
- Create Order
- Create Adv Billing Invoice (Adv Inv)
- Apply Cash Receipts to Adv Inv
- Create Customer shipment for Order. A BPM makes sure that any invoices related to the order are not open (unpaid).
- Create Shipping Invoice. The amount from the Adv Inv will be subtracted from the Shipment invoice.
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