As a business professional, you understand how important working capital is to your company’s financial health and growth strategies. But let me ask you this; How important is your accounts receivable? Hopefully your answer is “very important” because accounts receivable is one of the best and most accessible sources of working capital a company has; you’ve already earned it, all you need to do is collect it! For many companies though, collecting invoices is easier said than done but by implementing best practices in working capital management, you can quickly and easily turn those outstanding invoices into the capital you need to grow.
Accounts receivable truly is an issue. According to recent industry studies, roughly 39% of invoices in the US are paid late, usually in a time frame more than double the agreed upon terms; and businesses write-off 4% annually due to poorly managed collections. Focusing on your accounts receivable process is among one of the most successful best practices in working capital management.
On the surface, the 4% written of mentioned above does not sound too terrible, but think about this. For a $10m company, 4% is actually $400,000 written off each year-that is a significant amount of money! By reducing write-offs by only 10% the same company could save $40,000 each year and use it to grow their business.
In the webinar below, we discuss some common challenges and best practices in working capital management and how the use of accounts receivable management software can help you increase cash flow and get your money to the bank faster than ever before.
Common benefits of utilizing accounts receivable management software include:
• 10-20% reductions in daily sales outstanding (DSO)
• 25% reductions in past due receivables
• 15-25% reduction in bad debt reserves
• Return On Investment (ROI) in as little as 2 months