Allentown, PA, May 12, 2020 (GLOBE NEWSWIRE) -- Analysis of Creditsafe’s COVID-19 Impact Score shows that over 6.7 million companies, or 26 percent of all US companies, are at a severely high risk of failure because of the current economic crisis. Many of these businesses are already displaying increased signs of distress as they are now delaying payments to their suppliers by up to 50 days beyond agreed terms.
Creditsafe Asia & America’s CEO Matthew Debbage said that the results of this research made sobering reading. “We originally created our COVID-19 Impact Score to give businesses a chance to more clearly understand how the pandemic was likely to affect their business partners. However when you combine that impact with an understanding of the fundamental financial strength of a company as revealed by our standard credit score you can see that the risk is genuinely alarming with over 1 in 4 businesses at real risk.”
Creditsafe swiftly recognized that the current crisis has led to many businesses going into a self-imposed shutdown and potentially making knee-jerk credit policy reactions that only further impact the normal flow of trade as credit gets withdrawn or refused.
“We wanted to not just identify the issue” explains Debbage “but also provide practical tools to help companies make better business decisions. To that end we have developed a Credit Management Decision Matrix that combines our COVID-19 Impact Score with our underlying credit risk score to highlight the best approach for businesses to take.”
The Credit Management Decision Matrix is an intuitive tool that allows companies to quickly segment their customers and business partners into four easy to manage groups and adjust their credit management policies accordingly. This will then give them the chance to maximize trading opportunities while sensibly mitigating risk.
“We are very keen to continue playing our part in protecting US businesses and the wider economy so that we can come out of this even stronger.” Debbage continued “therefore we are making the Credit Management Decision Matrix available free of charge to all US companies.”
For more detailed information on how to access the Decision Matrix along with an easy to follow user’s guide please visit: https://www.creditsafe.com/covid-19-impact-score.html
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