Most companies face a wait time receiving customer payments that could range anywhere from 30 to 90 days to even longer. Payment delays not only cause anxiety for the collections management team, but they impact your cash flow. The bottom line is simple — the more quickly you collect your accounts receivable (AR), the better your cash flow situation will be.
You have undoubtedly heard about or have automated certain business processes already. By automating wherever possible, you’re looking where you can leverage technology to compliment your existing ERP or finance solution, and reduce labour-intensive administrative tasks, thus operating much more efficiently in the process. AR automation transfers invoicing to a digital process sets you up to receive multiple forms of payment, handles what is usually labour-intensive deductions, accurately applies cash, and captures and prioritizes collections efforts. In addition, AR automation allows you to:
- Create customer invoices based on your company’s data or simply upload an ERP created file of invoice PDFs to send and track electronically or via postal mail
- Send automated reminders for payment
Finally, AR automation also supports numerous types of collections strategies and is set up for internal collectors based on the collections rules and approach unique to your company.
The benefits of AR automation are numerous and impossible to ignore after you have experienced them firsthand. Here are the main reasons to consider implementing this year:
- Faster Payments
If you’re accustomed to dealing with clients who tend to pay your invoices at their leisure, then you’re not alone. This is just one of many reasons to consider automating your AR processes as soon as possible. The enormous benefit of automation is that e-invoices are made available for customers to pay immediately. This eliminates delays in payment that might have previously been common. AR automation can help you speed up your invoicing so you get faster payment.
- Improved Customer Experience
A benefit of AR automation is an enhanced customer experience. Your team is better able to focus on more strategic and detail-oriented tasks. When it comes to AR-related customer data, you know the more you can do to merge things for greater visibility, the better customer service you can provide. When it comes to inaccurate invoices or collections issues, AR automation technology allows you to quickly address any issues that may arise. By implementing technology in your AR processes, you are giving yourself a valuable tool that allows you to provide stronger customer service. Because of this enhanced customer experience, you can expect improved customer retention and a decrease in customer service-related problems.
- Cost Savings
Studies have shown that e-invoicing saves approximately $8 per invoice sent. This cost reduction might come as a surprise. However, the decrease reflects cost savings in several areas, such as postage costs, manual handling of paper invoices, cost of paper, envelopes, and equipment used in the printing and posting process. By implementing invoice delivery automation, your company can cut costs where you never could before. In time, the sizeable cost savings will be worthwhile to leverage technology to your benefit.
- More Control & Visibility
Another benefit of AR automation is the added control and visibility you and your team will gain. Invoicing and international e-invoice compliance, automated payment reminders, online customer payment, automatic cash application, collectors outreach and workflow, and capturing dispute reasons are just a few of the AR automation functions that allow real-time visibility and reporting. Improved visibility provides insight you and your team can act on.
You may still have reservations about making the switch. The manual processes you’ve always known feel comfortable and familiar. Change can sometimes be scary. Look at automation technology as something that can easily be adapted to your business needs. Opt for software that’s simple, intuitive and closely matches how you already do business. Consider automating your AR and collections process — it’s a more predictable and repetitive sequence of activities that provide benefits from end to end.