What used to be considered a back-office function has transformed into one of every organisation’s largest assets: accounts receivable. Why? Simply because it deals with one very important asset that doesn’t appear on the balance sheet — customers.
In order to capitalise on the assets of AR, organisations need best-in-class management strategies in place.
These eight strategies are excellent starting points for any business interested in achieving best-in-class accounts receivable management.
- Embrace technology This strategy is the linchpin that holds the other strategies together. Technology should not be viewed as a threat to existing staff members but instead as a highly specialised member of the team.
- Track metrics beyond DSO Measuring KPIs beyond DSO enables your team to track performance, give them accountability, and achieve the results they’re searching for.
- Move to e-invoicing Studies have shown that e-invoicing can result in cost savings between 60% and 80% compared to traditional paper-based methods.
- Confirm invoice receipts The most common reason customers give for making late payments is never receiving the invoice. Harnessing an automation solution with e-invoicing functionalities means you no longer have to worry about this anymore.
- Follow up early & often Automation tools allow you to easily receive on-time payments via automatic customised payment reminder emails so that no human involvement is required.
- Optimise team efficiency As much as one-third of an AR representative’s time may be spent prioritising who to call and searching for their information.
- Offer self-service tools According to Forrester, around 72% of people prefer self-service over phone or email support.
- Use root-cause analysis Using automated AR management tools, your team can identify, track and categorise root causes for late-paying customers, disputes and other areas, so you can fix any problems that are making it hard for customers to do business with you.
The great news is this: Any organisation that wants to modernise its accounts receivable process can do so. All it takes is a little help from technology and a willingness to evolve beyond the status quo.
Download the eBook, 8 Accounts Receivable Management Strategies to Make Your Process Best-in-Class, so that, when you’re ready to transform your process, you have all the information you need to be successful.