Restrict Credit Limit for Customers

Purpose:

The purpose of restricting credit limit for a customer in RetailEasy Fertilizer POS is to manage the risk of bad debt. By setting a credit limit, you can control how much money a customer can owe you before they are cut off. This helps to protect your business from financial losses.

Note: If the limit reaches it will show an overdue message while billing and it won't allow to proceed further in sales screen bill entry.

Benefits:

• Reduced risk of bad debt: As mentioned above, this is the main benefit of restricting credit limit. By setting a limit, you can be sure that you will not be left owing money to customers who are unable to pay.

• Improved cash flow: When you restrict credit limit, you are more likely to receive payments on time from your customers. This can help to improve your cash flow and make it easier to manage your finances.

• Increased control over customer spending: By setting a credit limit, you can control how much money your customers can spend. This can help to prevent them from overspending and defaulting on their payments.

• Improved customer relations: If a customer reaches their credit limit, you can offer them a payment plan or other options to help them get back on track. This can help to maintain good customer relations and avoid any negative consequences.

Steps to process to Restrict Credit Limit for Customers:

Step 1: Go to Customer > Master > Customer Master

Step 2: Customer Master screen will appear. Go to Credit Detail Tab, choose Allow Credit as Yes and mention the Credit Limit amount. Click Save.

Step 3: Go to Sales > Sales Bill

Step 4. Bill Entry Screen will appear. Select the Customer with mentioned Credit Limit. Load the Items. When the bill surpasses the credit limit amount, while saving the bill on Credit Sale Tender, a warning message will appear.

Conclusion:

when using the RetailEasy Fertilizer POS system, putting a limit on how much credit a customer can use helps avoid the risk of them not paying back what they owe. This limit stops them from owing too much money, which could be a problem for the business. If the customer's owed amount reaches this limit, a message will appear during billing, and they won't be able to make more purchases until they payoff some of what they owe. This rule helps keep the business safe from losing money and reminds customers to pay on time.

FAQ's:

Q1: Can customers still make purchases if they have overdue payments?
A: No, the system prevents customers with overdue payments from making further purchases once their credit limit is reached. This encourages customers to settle their debts before making more transactions.

Q2: Is the credit limit restriction a useful way to manage customer relationships?
A: Yes, the credit limit restriction strikes a balance between maintaining good relationships with customers and protecting the business's financial stability. It encourages customers to pay on time while preventing excessive credit exposure for the business.

Q3: Can the credit limit be changed or adjusted?
A: Yes, the credit limit can be changed or adjusted in Customer Master.