How to manage Customer Credit Limits

In Turbo Inventory, you can set and manage credit limits for customer accounts to ensure better control over outstanding balances. This feature is highly customizable, allowing you to define credit limits per customer and configure automatic actions when credit limits are exceeded or invoices become overdue.

1. Viewing and Setting Credit Limits

To manage credit limits for your customers, follow these steps:

1. Navigate to the Customer List:

   • Go to the Customers section and open your customer list.

2. Add the Credit Limit Column:

   • Click on the Column Chooser option and add the Credit Limit column to your view.

3. Understanding Credit Limits:

   • By default, customers with a zero credit limit in Turbo have unlimited credit. For example, if a customer has a credit limit of zero, they are not restricted from making purchases regardless of the outstanding balance.

4. Setting a Credit Limit:

   • To set or adjust a credit limit, click on View next to the customer you want to edit.

   • Click on Edit, then scroll down to the Credit Limit field.

   • Set a specific credit limit for the customer (e.g., $4,000). Once this is set, the customer cannot make purchases beyond the credit limit.

5. Enforcing the Credit Limit:

   • If the customer attempts to make a purchase that exceeds their credit limit, Turbo will prevent further charges until the balance is paid down.

2. Automating Account Holds for Overdue Invoices

Turbo also allows you to automatically place a customer on hold if their invoice becomes overdue, regardless of their credit limit. This provides additional flexibility to ensure that no further sales occur until the overdue invoice is settled.

1. Enable Invoice Reminders:

   • Go to Sales > Sales Invoices and click on Invoice Reminders.

   • Check the option to automatically put a customer account on hold when the invoice is overdue. This will prevent the customer from placing additional orders until the overdue invoice is paid.

2. Flexibility in Account Hold Settings:

   • You can configure the system to automatically put a customer on hold when their invoice becomes overdue, no matter what their credit limit is.

   • This ensures that overdue invoices are prioritized and that the customer cannot continue to make purchases while their account is overdue.

3. Setting Payment Terms to Block Credit Usage

You can also configure payment terms that will prevent a customer from charging new purchases to their account if they have not paid the previous invoice.

1. Define Payment Terms:

   • Go to Sales > Payment Terms and select the appropriate payment term.

2. Set Payment Terms to Zero:

   • If you set the Term Days to zero, it means that the customer must pay their invoice immediately. They will not be able to charge any further purchases to their account until payment is made.

4. Customizing Customer Credit Management

Turbo offers a flexible approach to managing credit limits, allowing you to customize settings based on the needs of your business:

• Specific Credit Limits: Set individual credit limits for each customer based on their purchasing history and your business requirements.

• Unlimited Credit: For some customers, you may opt to leave the credit limit as zero, giving them unlimited credit access.

• Invoice Reminders and Holds: Set up automatic holds when invoices are overdue, regardless of the customer's credit limit.

• Payment Terms: Customize payment terms to restrict the ability to charge to the account until previous invoices are settled.

Conclusion

By setting and customizing credit limits and invoice reminders in Turbo Inventory, you can maintain control over customer accounts and avoid potential issues with overdue payments. Turbo's flexibility ensures that you can tailor credit management to suit the unique needs of your business.