Customs Broker Uses D&B Credit for Confident Credit Decisions
International trade – it’s a complex system to get items cleared through U.S. customs. A.N. Deringer, the largest, privately-held customs broker in North America, was founded almost a century ago, when pen, paper, and a keen eye were all that were needed to ship goods in and out of the country. Since then, it has grown to exemplify the values, beliefs, and business acumen required to stay competitive, now employing more than 450 dedicated professionals in 30 locations along the U.S./Canadian border. A renowned supply chain partner, Deringer is an integral component in providing logistics solutions, warehousing and distribution, and meat inspection to the growing number of national and international suppliers.
The Challenge: Streamlining the Credit Review Process
Given the nature of the brokerage and freight forwarding industry, A.N. Deringer has a broad and diverse customer base – essentially any company importing goods into the US is a potential customer, ranging from distribution to manufacturing to services. With an average of 125 new business credit customers coming onboard each month, Credit Manager Paul Laska sees the challenges associated with the ever-expanding growth of customs brokerage, in addition to the ongoing tariff issues which are exponentially increasing their Accounts Receivable (A/R). Scrutinizing every credit applicant takes time, resources, and reliable data. Paul has set a vital KPI for his staff - he and the entire Deringer team pride themselves in turning around new customer requests in four hours or less, making accurate risk assessments almost as valuable as the open line of credit they offer.
But for Paul, the two to three months it can sometimes take for Deringer’s sales team to cultivate a relationship and secure the business can be a possible waste of valuable time if potential clients fail to meet their business’s line of credit requirements. As a consequence, if the sales team is anticipating a large A/R exposure client, they will reach out to Paul to vet the customer very early in the sales cycle to ensure the prospect can obtain a line of credit once a credit application is finally submitted, and this is where D&B credit analysis tools come into play. “We're obligated to vet each and every individual customer based on U. S. customs requirements, so when we take on a new customer, when we make them open and billable, we need to have a reasonable degree of confidence that they've got the ability to pay us timely,” explains Paul.
Deringer establishes defined credit limits, and therefore, objective facts were the key assurances used in credit risk assessment. Paul states, “We can't wait an hour to get a Canadian report. We can't wait seven days to get an international report itself, so we rely on real-time data.” Paul and his team needed to make confident credit decisions on customers and partners and do so in a faster, smarter way. After trying other solutions and finding limited success, Paul established his relationship with Dun & Bradstreet.
The Solution: Increase Business Decision Confidence with Credit Risk Tools
Paul began by sharing his needs based upon Deringer’s varied customer base of national and international businesses and the necessity for a quick turnaround time. They began using D&B Credit, Dun & Bradstreet’s core credit risk management solution, to get a complete view of a company's financial health to make confident credit decisions without the guesswork. It gave Paul and his team the confidence they need to proceed or deny the application. Paul states, “Whether it’s (the) PAYDEX Score, how long have you been in business, the number of employees, how well you're paying your vendors, or the overall credit score, it’s all right there in front of us. It's in depth. It's easy to read. It's easy to digest. It provides all the important elements we feel comfortable with and that we take a look at to give us confidence.”
It’s confidence that comes into play when Paul and his team tap into real-time data and insights through D&B Credit. Proprietary D&B analytics, trade payment history, trending data, and customizable real-time alerts allow Deringer to manage and monitor their customers and keep up-to-date with changes to their credit profiles. “Utilizing alerts helps us a great deal, obviously a change in a PAYDEX or a credit score, and we're going to pay attention,” Paul said. Comprehensive reports in D&B Credit also leverage D&B’s unrivaled predictive and performance-based credit scores and analytics powered by the Dun & Bradstreet Data Cloud, which delivers the world’s most comprehensive business data and analytical insights: comprising over 300 million business records and updated 5 million times per day. It’s what gives Deringer the speed, accuracy, and confidence it requires to monitor a customer’s financial health, as well as protect their own.
The Results: Benefits of Using D&B Credit
Today, Paul and his team at A.N. Deringer can confidently tap into the Data Cloud via D&B Credit to research, react, and respond in real-time, so they can make the right decision when processing credit applications - which for Paul is invaluable. “D&B continues to be the market leader. I have a great deal of confidence in the data that D&B provides, and again, the quality of data that you provide is second to none,” he says.