Streamlined accounts receivable processes help improve cash flow and reduce days sales outstanding. With automation, businesses can eliminate manual, time consuming tasks like sending payment reminders and manually tracking invoice status.
Choosing the right payments solution can help companies automate their accounts receivable processes. This helps reduce costs, boost productivity and gain fresh insights.
Reduce Invoice Errors
Often, invoice errors result from manual processes such as data entry and the re-entry of information into multiple systems. The complexities of this kind of invoice processing are what make them ripe for automation – it can take on the repetitive tasks that are more prone to human error, and do so in a much faster time.
With a high-quality automated invoice process, you can eliminate many types of invoicing errors and ensure that all the right details are captured from each document. It’s also much quicker to complete these processes without the need for manual intervention, meaning your team can save valuable time that can be used on more productive work.
In addition to the benefits of speed and accuracy, automated invoices can be created in a way that helps you meet customer requirements. They can be configured with specific line items, purchase order and project code information that will help to validate the payment on the customer side. This can help reduce your DSO and improve cash flow, while reducing the chance of bad debt write-offs.
Invoice automation will also deliver visibility to your finance team that can be difficult to achieve when relying on manual processes. You can use it to create reports and dashboards that provide a bird’s eye view of performance, identify if your reps are meeting or exceeding goals, and keep close tabs on days sales outstanding (DSO) metrics.
Faster Invoice Processing
Invoices play a crucial role in determining your company’s cash flow and as your business grows, it becomes increasingly important to ensure that all invoices are created accurately and distributed promptly. However, with an accounts receivable process that’s completely manual, these goals are often difficult to achieve.
Using automation tools to automatically scan, interpret and record the information contained in an invoice is one of the most effective ways to speed up invoice processing. It removes human error and allows employees to focus on other tasks – improving efficiency and helping your business reach its key performance indicators.
To maximize the benefits of implementing an accounts receivable automation solution, it’s essential that you clearly define what you want to achieve before taking the plunge. Whether that’s to cut down on errors, improve collection times or reduce manual data entry, setting out your clear objectives will give you the confidence that you have selected the right software.
Once you’ve defined your goal, be sure to communicate this to your team and ensure that everyone who will touch the new software has been trained and understands how it can benefit them and the business. Additionally, look for a solution that offers a flat fee rather than a per-user charge as this will make it easier to share access with all relevant individuals within your business.
Minimize Your Administration Costs
Having software do basic tasks is an inexpensive way to save time and money. The more you can automate in your business, the more savings you will have.
Incidental costs are a big deal when it comes to accounting, especially as you scale your business. Manually printing invoices and mailing them to customers adds up quickly in terms of paper, ink, stamps, etc. By moving to automation, you will also reduce your administration costs by removing the need for employees to print, mail, or make copies of invoices.
Another way that automation can help to minimize your administrative costs is by reducing the number of errors that may occur due to human error. This is especially true when it comes to accounts receivable. Automation helps to eliminate these mistakes, resulting in fewer unhappy customers.
Automation in accounts receivable will also help you improve your cash flow by reducing days sales outstanding (DSO). This is achieved through better visibility into the entire process, including invoicing, payment collection, and reconciliation.
When selecting an accounts receivable automation solution, look for one that integrates with your other systems, such as your accounting software. This will ensure that the information you need is available across departments, and that it is accurate and up-to-date. It will also be able to automatically reconcile reports for you, further minimizing the chance of data entry errors. It should also be affordable with a flat monthly software fee and standard transaction fees.
Increase Customer Satisfaction
Aside from saving your team money and improving efficiency, accounts receivable automation helps to increase customer satisfaction by delivering a smoother experience. Customers today are accustomed to instant communication, and they want to be kept updated on the progress of their orders. Manually checking incoming orders in your ERP and then entering them into Amazon Seller Central takes time, which could be better spent on other tasks. Automation software eliminates the need to do this, and also provides a much more up-to-date view of your orders in real-time.
In addition, many businesses that have switched to automation see a significant drop in day sales outstanding (DSO), which improves cash flow and reduces bad debt. This is because automation software works 24/7 to help your business stay on top of payments, ensuring that invoices are emailed promptly and correctly.
Lastly, automated software can send out upcoming payment reminders automatically to your customers via email, which is a much friendlier experience than a “Your Payment is Past Due!” message. The right solution can also enable you to offer your customers flexible payment options and an online portal for them to manage their accounts with you. This is another great way to give your customers a positive experience and to encourage them to continue doing business with you. When shopping for an accounts receivable automation solution, look for a company that offers a flat-rate monthly subscription fee for all users. This ensures that you can easily share reports and responsibilities with your team.
