Collections is one of the most important areas of a business, however, it also takes up way too much time. A majority of businesses are still manually doing accounts receivable tasks using spreadsheets, highlighters and aging reports. This is not the most efficient of effective way to get customers to pay on time. Most of your time will be spent inputting and extracting data, rather than making those important phone calls to collect.
Automating the accounts receivable tasks makes the process easier and allows you to focus on the most important accounts that need to pay immediately. Below are the 5 accounts receivable tasks that should be automated in order for you to be effective in the collections process.
Automated email allows you to schedule messages in bulk to send out to customers. This could range anywhere from a welcome letter to a past due notice. Based on rules you set in the system, emails will send out to anyone who falls into the category of a “new customer” or “45 days past due”. You will never forget to contact a customer because it will be done automatically, improving your customer relationships.
One hurdle that will always slow you down in the collections process is waiting on paper checks to arrive in the mail. It is one easy way for customers to put a delay on payment. In order to eliminate these issues, using an online bill pay system allows customers to use credit cards and ACH payments. Customers self-serve the payment by clicking a secure portal link in an email, keeping payments hands-off on your end.
- Invoice Presentment
Recreating invoice after invoice for every individual customer is time consuming. One accounts receivable task to automate is invoice presentment. Keeping a template on file and having all the invoices populate and send out to the correct customer automatically cuts down on hours of time.
- Credit Risk Management
In deciding how much credit to extend to new customers, or keeping an eye on existing customer’s credit for red flags, you have to be able to have easy access to customer credit reports. If you are using an accounts receivable automation tool, this information can be linked to the customer’s account and available any time that you need. You can also set alerts if a customer’s credit score dips below a certain threshold.
- Invoice Dispute Management
The longer an invoice is in dispute, the less likely you will collect on the full amount of the invoice. That’s why it is crucial that invoice disputes are dealt with quickly. Automating the invoice dispute process by setting up alerts for any invoice that goes into dispute allows you to handle the situation immediately. Further, assigning a reason code to each one keeps you abreast of the most common issues to possibly eliminate them in the future.
These 5 accounts receivable tasks should be automated in order to make your life easier and make the accounts receivable process more efficient. These are all tasks that need to be done often and are probably taking up the most time manually. Using an automated accounts receivable solution is one way to easily automate all of the above tasks, and more.