Making sure your customers pay in full and on time is paramount to running any successful business. However, the responsibility doesn’t fall only to the customer – it also counts on the efficiency and reliability of your accounts receivable department. Although there aren’t any tricks that will magically make difficult clients start paying their bills on time, accounts receivable doesn’t have to be as complicated as you might think. With the following tips, you can streamline the process and enjoy better visibility into your finances:
#1. Maintain Accurate Customer Data
Ensuring the accuracy of customer data is crucial to implementing and maintaining an efficient accounts receivable department. After all, you can hardly expect to get paid if you’re sending billing statements to the wrong address. To avoid late or missed payments and increase your chances of getting paid on time, you must ensure that all customer data is accurate and up to date.
Easily the most efficient way to ensure this is by implementing a centralized data storage system that unifies all records from various departments and databases. A centralized approach ensures accuracy by closely keeping track of data and version control. That means no two departments or employees in your business should be seeing contradictory data.
#2. Choose the Right Invoicing Software
Every business leader needs to have clear insight into the financial pulse of their company, even if they’re not the ones who have to handle invoicing themselves. If you’re sending out more than a handful of invoices every week, then you’ll need a scalable and, preferably, cloud-based accounting system such as Sage Intacct. By choosing the right system, you’ll be better equipped to keep track of your finances.
A dependable software solution will help you keep track of the invoices that have been sent, how many have been paid, and which payments have yet to be received. Furthermore, choosing the right invoicing and billing software makes sure that all relevant data is included in your invoices which, in turn, reduces problems that might result in late payments.
#3. Get Rid of Obstacles
An efficient business process is one that uses as few tools and steps as possible to get the job done. Accounts receivable is no different. For example, your employees should never have to use two completely different systems to send invoices. If they’re having to refer to an entirely separate CRM database to find things like billing information, then that’s a good signal of an inefficient process with one too many obstacles.
We’ve already seen how having a centralized database for all business departments to use helps with data accuracy, but it also makes things much easier for employees, since they don’t have to use several different systems to do their jobs. Furthermore, you should also simplify the process for your customers by offering a wider range of payment options.
#4. Turn to Automation
Most small businesses still rely on manual processes for creating and sending out invoices. That might be fine if you’re sending out only a few dozen invoices every month, but it becomes highly impractical once it becomes a full-time job. There’s also the increased risk of human error to think about, as well as the fact that you might end up increasing the chances of non-payment.
Automation eliminates human error and significantly reduces the workload on your employees. Many SaaS (software-as-a-service) solutions can automatically create and send invoices as soon as a project is complete, thereby streamlining workflows in a way that simply wasn’t possible before.
WhiteOwl is a leading provider of cloud technology. We help small- and medium-sized businesses implement and maintain high-end ERP, CRM, and accounting systems to streamline core organizational processes and optimize your bottom line. Get in touch with us today to request your free IT assessment.