Most companies struggle with outstanding A/R for many reasons:
- Maybe they don’t have a dedicated A/R employee
- lack standardized collection procedures
- fail to get invoices to customers quickly
- send incorrect invoices
- and many others.
Collecting outstanding accounts receivable is hard, but it doesn’t have to be when you have the right tools, information, processes, and people in place. Debt collection software helps companies pull those elements together to address the above issues and help you get paid faster. With the inclusion of debt collections software into your business strategy, you’re going to see some pretty amazing things happen, some of which include:
There are many benefits found by those who use debt collection software to automate accounts receivable, one of the biggest though is the time savings it provides. There are a vast number of daily clerical duties that go into accounts receivable management; and while they are critical to the job, they are time-consuming, redundant, and open to human errors that cause payment delays and disputes.
Some of these daily activities include reviewing aging reports, updating spreadsheets, prioritizing contacts and putting together daily to-do lists, researching accounts to prepare for calls, taking notes, etc. all of the activities can be considered non-value added and are a drain on collector productivity and efficiency. With all of that to be done, there is little time left for what really matters- collecting invoices, dealing with disputes, and communicating with customers.
Any credit collection professional will tell you that collecting and managing invoices is time consuming and any manager will also tell you that the time collectors spend doing clerical tasks associated with invoice management is the largest killer of productivity. Of course, this is not the collector’s fault, those clerical tasks must be done in order for them to do their jobs, but there is a better way. By implementing debt collection software, collectors can put such time consuming tasks on auto pilot and focus on more critical activities that directly impact the company’s bottom line. Continue reading
Some companies, more than you might think, attempt to use their existing CRM software to manage the credit and collections process. This is because many have a hard time seeing the difference between CRM and debt collection software because they share some very similar qualities, but it is very important to understand the differences between these two systems and how they will affect your cash flow and overall profitability.
There are two critical differences between CRM and debt collection software:
Companies love to get paid; and the quicker the better. This is a no-brainer. Debt collection software is the most tactical method for reducing days sales outstanding (DSO) for most companies. With automated workflows and streamlined business processes, debt collection software frequently reduces a company’s DSO from anywhere from 10 to 40 percent. This results in increased cash flow, putting money in the bank 6-12 days faster.