As technology has advanced so too have the tools we use in our day-to-day lives. We don’t ride horses to work anymore, construction companies don’t use manual shovels to dig large holes, we rarely write hand-written letters, and many people don’t even hand-wash dishes anymore. Why? Because innovation and technology have given us faster, more efficient ways to get things done.
The same is true of accounts receivable management tools. Traditionally, companies relied on aging reports, spreadsheets, and color coded highlighters to manage invoices, but that’s no longer the most effective or efficient ways to get the job done. In fact, those highly manually processes can create cash flow shortages that can cause serious profitability problems for your company.
As with all things, time and innovation have created a better way for business to manage invoices. Here are some of the most popular modern tools to consider if you’re looking for ways to increase working capital and take time-consuming manual labor out of your receivables process.
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A/R Management Automation
Accounts receivable automation software is a tool that integrates with your accounting or ERP system to help you reduce manual processes and collect invoices from customers faster. The software helps you do this by centralizing your invoice information into one system, and by automating many of the steps involved in the accounts receivable management process. This not only eliminates manual tasks from your to-do list, but it helps make sure nothing is falling through the cracks because you don’t have time to take care of it yourself.
This quote from a company who uses A/R automation software says it best: that a system “manages everything from the time we send out the invoice until we receive payment. It’s almost like having another full-time accounts receivable resource, because it automates so many steps which saves us time so we can make more calls.” This company was able to get paid 51% faster with the help of automation- read the full story.
There are literally hundreds of products on the market today to help you manage accounts receivable, so we’ve put together a guide to help businesses understand the value proposition for automation software, major features available in popular applications, and tools to help you evaluate and compare various applications based on your functional requirements, industry needs, budgets, and technology strategies.
Electronic Invoice Presentment and Payment (EIPP)
If you’re currently sending invoices and receiving checks in the mail, you stand to significantly cut down the time and effort involved if you move to an electronic solution. Electronic invoice presentment and payment allows you to send invoices and receive payment from customers online, eliminating the days of waiting on either end of the collection process, the cost of paper materials, the work, and the paper cuts related to traditional paper-based processes.
Further, EIPP makes it easier for customers to pay you; and if you’re easy to pay, they’re more likely to pay you on time and before other vendors who are more difficult to work with.
Customer Self-Service Portals
Recent studies have shown that over 70% of SMB customers prefer a self-service option where they can log in 24/7 to get information on their account, retrieve invoices, pay bills, ask questions, view statements, chat with support reps, etc. It makes sense when you think about it: nobody has time for phone-tag anymore, and having everything in one place just makes things easier to understand. By granting customers the control and convenience they want, you can significantly increase on-time payments, customer satisfaction, and reap many other self-service benefits.
While you don’t need to implement every one of these tools, it’s time to start thinking about tossing out those highlighters and taking advantages of technology in A/R as you have in other areas of your business and personal life. Learn more and watch videos of these solutions in action in our Resource Center.