Banning a Customer
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Reasons for Banning a Customer
A customer may be banned for one or more of the reasons below. Banning a customer is an irrevocable action, and no employee is allowed to remove a ban without the written permission of the Managing Director.
Reason 1: The Accounts Team have used a lawyer or credit collection agency to pursue the payment of overdue invoices (this is the final step in the Accounts Receivable Procedure).
Reason 2: The customer is consistently unreasonable and inconsistent in their communication to the point where a profitable relationship cannot be sustained.
Reason 3: The customer is a reseller who is developing into, or has become a competitor.
Reason 4: The Customer is in the ‘lead’ stage (has never ordered) and is clearly a fraudster.
Procedure for Banning a customer
The procedure differs depending on the reason. Prior to any banning procedure, a duplicate record check should be conducted (see section called ‘Netsuite – Duplicate Records’) to ensure that the banning action is as comprehensive as possible.
Procedure for Reason 1: Accounts UK add a note to the customer record in Netsuite briefly stating the reason for imposing the ban and remove the credit facility from the customer record. The Legal Advisor sets the customer category to ‘Customer Banned’.
Procedure for Reason 2,3: The Sales Account Manager informs their Sales Team Manager of the reasons for requesting a customer ban in writing. The Sales Team Manager forwards the request to the Legal Advisor. If the customer balance in Netsuite is more than 0, special attention is required during the Accounts Receivable Procedure. In this instance, it may be necessary to ask the customer to provide payment in full prior to the announcement of the ban to the customer as this may considerably delay payment from the customer.
Procedure for Reason 4: The Sales Account Manager informs their Sales Team Manager of the reasons for requesting a customer ban in writing. Subject to agreement the of the management, the Legal Advisor sets the customer category to ‘Customer Banned’ stating the reason in the notes of the customer record. The text template below should be used.
Communicating to a banned customer
Dear [INSERT NAME OF CONTACT],
After a thorough review of your company website and commercial activities we have concluded that we are not in a position to supply [INSERT NAME OF COMPANY].
It is our view that supplying your company would result in a conflict of interest on our behalf. In the interest of competition and as part of our general sales policy we do not supply companies that could be considered to be our own competitors.
If we were to supply your company it would be possible that we would both be approached to quote for some of the same enquiries. In such circumstances we would have a clear conflict of interest and the supplier relationship would therefore not be sustainable.
We wish you every success in securing an alternative supply.
Regards
