Take any e-commerce company, and you will most certainly find that their core focus is to sell their products to satisfied consumers, while increasing productivity and lowering costs. Yet one bump in the road to sustained profitability is the absence of efficient credit management. Late payments or no payments are often catastrophic to a company’s cash flow.
A recent report from J.P. Morgan predicts that e-commerce revenue will grow 19 percent worldwide in 2011, but it also states that large companies such as Amazon are outcompeting smaller players, and that differing payment systems from country to country can limit business growth. Considering the increasingly competitive online market, it is now more important than ever for e-commerce companies to think about how they will manage payments from the very beginning.
“We have seen that there is a lack of an effective infrastructure for e-commerce in many European countries, and especially cross-border,” says Per Christofferson, Director of Credit Management Services at Intrum Justitia. “Any payment failures are a loss for companies. In fact, 25 percent of companies that go bust in Europe, do so because of late or no payments. So many e-commerce businesses still have to rely on consumers who want to pay by credit card.”
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