The credit and sales teams often have strained relationships due to differing goals. Deana Reynolds, Director of Credit at Edges Electrical Group, believes that with the right approach, these two departments can work seamlessly together to drive company success.
In a conversation with Handle.com’s Lori J. Drake, CBA on Credit Talk w/ Lori, Deana shared her insights on how encouraging better collaboration between credit and sales teams can lead to stronger partnerships, improved communication, and better outcomes for the business and its customers.
Here are three critical lessons from the interview that will help credit and sales teams achieve their goals harmoniously.
Embrace the Dual Role of Credit Departments
Credit departments often carry the burden of being perceived as the company’s collection agents. However, as Deana explained, credit’s role is much broader.
“When people hear credit, they immediately think collections,” she noted, “but the role of the credit department is really so much more than just collecting money.”
Credit professionals have two primary responsibilities: managing external customer relationships and providing support to internal sales teams.
Externally, credit teams must ensure that customers fulfill their financial obligations, which include filing preliminary notices and retaining mechanics lien rights to protect the company’s interests. Deana pointed out that this diligence in safeguarding lien rights often results in their customers getting paid on time, strengthening those external relationships.
The widespread adoption of lien rights has a positive impact that benefits all parties involved. While there may be different viewpoints on mechanics liens, it’s crucial to understand that these legal tools exist to safeguard all businesses participating in construction projects and ensure timely payment. When customers recognize and implement mechanics liens as a fundamental element of sound business practice in the construction industry, it can lead to improved business for everyone.
Of course, credit’s role doesn’t end there, Reynolds stresses. Internally, credit departments work closely with sales teams to process credit applications, set up new accounts, and ensure that sales efforts align with the company’s risk tolerance and credit policies. This collaboration helps to create a smoother sales process by ensuring that new deals are financially sound from the start, minimizing risks down the line.
Credit teams also provide ongoing support by regularly reviewing customer accounts and updating sales teams on potential issues, allowing both departments to address challenges before they become serious problems.
Credit professionals must excel at balancing the essential task of safeguarding the company’s financial health while effectively supporting the sales team’s objectives.
Foster a Partnership Mentality
Sales teams are highly focused on closing deals, driven by commission-based compensation structures, while credit departments meticulously ensure the financial viability of those sales.
Some tension can be present because the credit teams are sometimes seen as getting in the way of making sales.
But Deana advocates for a shift in mindset: “Just changing the narrative and treating our sales team like a partner or a customer rather than an adversary is really super valuable.”
At Edges Electrical Group, this partnership mentality has improved communication and built trust between the two teams. Credit professionals demonstrate their commitment to supporting sales by actively participating in the sales process, such as attending sales calls and directly engaging with new customers. Credit professionals have the unique capacity to offer real-time insights on potential customers–helping sales teams navigate deals better.
When sales teams have vital information from the credit department, potential conflicts are avoided. Additionally, presenting a unified front to customers results in better outcomes that benefit the bottom line.
Deana emphasized that this approach to teamwork has made salespeople feel more comfortable approaching the credit team with their challenges. “They’re not afraid they’re going to walk in the door and we’re just going to slam them with a no,” she said. Instead, credit teams can work with sales to find solutions that meet the needs of both the company and its customers.
Prioritize Communication and Teamwork
For a credit-sales relationship to thrive, communication must be open and ongoing.
Deana noted that at Edges Electrical Group, the credit team strives to be approachable and supportive. “We don’t like being known as the ‘no’ group,” she shared. “We’re doing our best to get you a yes.”
By shifting the focus from simply denying requests to finding practical, mutually beneficial solutions, the credit team strengthens its relationship with sales, encouraging trust and open communication. This approach improves team morale and leads both departments to collaborate on creative solutions, where both teams feel empowered to work together to address issues before they become roadblocks.
Benefiting from each other can only happen when there is open communication, when both teams understand each other’s challenges.
For instance, sales teams need credit’s support to close deals, while credit teams rely on sales to bring in financially sound opportunities. Regular interactions, whether through formal meetings or casual check-ins, help both sides stay aligned and build trust.
Credit and Sales As Strategic Allies
Deana Reynolds’ insights provide a practical guide for dismantling the traditional barriers between credit and sales teams. Recognizing the double role of credit departments, encouraging a partnership mindset, and emphasizing open communication and collaboration can strengthen internal connections, supporting financial stability and sales success.
Watch more Credit Talk with Lori on the Building Blocks Channel.