Benchmarking the Credit and Accounts Receivable Functions

CRF presents a "Standards" Approach to Performance Improvement

Our survey illustrates important credit and A/R management data among companies and sets forth a method of comparing the data in a statistical benchmarking format.

Statistical Benchmarking links important credit and A/R management, workload, transaction and cost data among companies; and, portrays a comparative analysis by industry in table format for a multitude of metrics. This CRF report is recognized as the most comprehensive data of its kind.

CRF's Statistical Benchmarking provides an excellent tool for credit, collections, and accounts receivable executives to develop and implement an accurate performance measuring process. CRF has been the leader in statistical benchmarking for the credit, A/R and related tasks for over a decade. We are currently on a data drive to accumulate current statistical data.

• Take survey online or print a paper copy
• Frequently Asked Questions about CRF's Benchmarking
• CRF Confidentiality Statement
• View a sample report

Please note, this example is sample data only.
Our data consists of hundreds of company records from a broad variety of industries. The data in this sample report is fabricated for illustration purposes only. Do not use it to benchmark yourself!

CRF's benchmarking is the first step in determining where you are today.  Our statistical study can present your data and compare your organization's performance across:

• All companies from all industries in our database;
• Your own business unit group;
• A specific industry in general or a specific industry group that you are a part of;
• Workload volume;
• Sales volume;
• Customer volume;
• Transaction volume

CRF's valuable data will help you:

• Learn the Key Performance Metrics for success;
• Establish goals and set strategies
• Manage your resources;
• Make more informed decisions;
• Prioritize your improvement objectives;
• Understand attainable goals;
• Help you and your organization become more competitive.

• CRF Premier Members can request one free benchmarking report inclusive with their annual membership.
  
  
• Any company participating in the survey will receive the full report for FREE as a thanks for their data contribution to help make our service more valuable.
  
  
• The cost to credit professionals or finance executives of manufacturing and distributing (wholesalers) companies who do not participate in the survey but want to purchase the full report is $500.00;
  
  
• For all others the cost is $1,500.00

  View a sample report.    Take survey online or print a paper copy
  

  The objective of the Credit Research Foundation in this initiative is three-fold:
  

  1. Information Clearing House - As a third party organization, CRF's interest is to offer an opportunity for companies to exchange information, benchmark with each other on performance issues and, at the same time, ensure the confidentiality of data.
  
  
  
  2. Communication Link - INDUSTRY GROUP BENCHMARKING--While the objective of CRF's benchmarking is to compare your company's performance to the "universe of samples" and specifically against those in your related line of business, benchmarking can be a tool to familiarize you with your peers.
     To this end, if you are a member of an industry credit group, CRF can perform a specific benchmarking project for your group. This unique project will open the door to discussion of "best practices" within your group, and will lead to stimulating meeting topic discussion.
     Special Group discount pricing is available for this project. Contact us at the bottom of this page.
  
  
  
  3. Education - For those that are new to the benchmarking concept, it is hoped that this information will enhance your understanding of the role of benchmarking and its potential benefit to the credit, collection and accounts receivable functions.
  Our thanks to members of the Research Committee of CRF (credit executives from a variety of American companies) who have defined the terms used in the formulas so that the data can be collected and reported on a uniform basis.
  
  CRF's Benchmarking Report
  
  The Benchmarking Report is a detailed report customized for each participant. The statistics below are arrived at by comparing an individual company's performance in credit and collection against all companies in the CRF database. Those statistics are then compared to similar companies in the same industry.
  
  CRF Metrics calculated are:
  
  I. FINANCIAL PERFORMANCE METRICS
  DSO
  Best Possible DSO
  Average Days Delinquent
  Collection Effectiveness Index
  Percent Current
  Percent AR Greater Than 60 Days
  Percent AR Greater Than 180 Days
  Gross Bad Debt as % of Sales
  Bad Debt Recovery as % of Sales
  Net Bad Debt as % of Sales
  Deductions as % of AR $
  Deductions as % of AR items
  
  II. CUSTOMER METRICS
  Top 10 Customers as % of Sales
  Top 20 Customers as % of Sales
  Invoice Size
  Number of Invoices Per Customer
  Number of Active Customers
  Primary Customer Type
  
  III. DEDUCTION METRICS
  Number of Deductions Processed Per Deduction Processing Employee
  Deduction Processing Costs as % of Sales
  Deduction Turnover
  Deductions Salary Per Deductions Employee
  Deductions as % of Sales
  Deduction Balances Included in AR Portfolio
  
  IV. EFFICIENCY METRICS
  Various costs per transaction, employee, salary for Credit/Risk, Cash Application, Collections, etc.
  
  V. OUTSOURCING METRICS
  Percent of Workload that is Outsourced for Credit Risk, Cash Application, Collections, Deduction Processing, etc.
  
  VI. COST ANALYSIS METRICS
  Collection expenses
  Outside Services
  Outsourcing
  Travel
  Occupancy or Rent
  IT Systems
  Depreciation/Amortization
  Total Cost as % of Sales, % of FTE Salary Benefits, Per Customer and Per Employee
  
  VII. BUSINESS PRACTICES METRICS
  % of Companies Charging Late Payment Fee
  % of Companies that Accept Credit Cards
  % of Companies Allowing Anticipation Payment Discount
  % of Late Payment Charges Ultimately Collected
  Annual $ of Credit Card Sales as % of Sales
  Electronic Invoicing
  Electronic Payments
  Auto Write-off
  Use of Auto-cash Systems including Auto-cash Hit Rates
  $ Amount Shipped Automatically to New Customers with No Credit Investigation
  % of Customers in Highest (Top Third) Risk Category
  
  VIII. ORGANIZATIONAL STRUCTURE / RESPONSIBILITIES
  Reporting Relationships
  Where Various Functions are Primarily Performed within the Organization
  Department Responsibilities
  
  IX. SYSTEMS INFORMATION
  AR or ERP Systems Used
  Use of Bolt-on Deduction Management, Collection Management Systems and Credit Scoring Systems