Blog 2018-04-26T09:34:27+00:00
2307, 2018

How to Get Your Small Business Customers to Pay You Faster with Less Effort

By | July 23rd, 2018|Categories: Blog|Comments Off on How to Get Your Small Business Customers to Pay You Faster with Less Effort

Running a small business is tough.  In speaking to countless small business owners throughout my career, one thing became clear – a desire to do accounting was decidedly not the motivating factor in their decision to launch a new business venture.  Expense management, time-tracking and invoicing customers are not the things that the small business entrepreneur thinks about when they are getting started. Ultimately, one of their biggest challenges becomes trying to find the time to deal with these tasks.  Fortunately, for small businesses there are many automated solutions to help them manage the accounting side of the business including their own receivables. Products like QuickBooks, Freshbooks and Jobber all help these small businesses to track their efforts and collect their money.   But what about the other side of the equation — the challenges that small businesses face in automating payment of their bills and that large businesses face in collecting from them?  In the same way that neglecting to collect payment will hurt small business because they’ll be losing out on cash flow- failing to pay their bills on time will also cause the business to suffer.  Suppliers will stop providing products,. Distributors will stop providing delivery services. Read More

1707, 2018

Electronic Invoice Presentment and Payment (EIPP) vs. Automated Receivables

By | July 17th, 2018|Categories: Blog|Comments Off on Electronic Invoice Presentment and Payment (EIPP) vs. Automated Receivables

As accounts receivable automation continues to become entrenched as the new standard for managing receivables, many well-intentioned leaders continue to investigate alternative solutions that don’t address the totality of the problems their teams face on a daily basis. Today, I’d like to take a look at Electronic Invoice Presentment and Payment (EIPP) with a view to the important differences between it and our automated accounts receivable platform, ARC. At a surface level, the intent behind EIPP and ARC is very similar – provide customers with a great front-end experience for the AR process, increase the number of payment options available and, ultimately, drive more efficiency out of the AR process. Unfortunately, despite similar purposes, the business impacts are wildly divergent. EIPP – The Ugly Truth Let’s assume that your customer base follows a normalized distribution curve – 1/3rd will pay early, 1/3rd will pay on or around the deadline, and a 1/3rd are (to put it nicely) “payment averse.” Under this scenario, 2/3rds of your customers have good intentions to pay their invoices – and for these segments, EIPP provides a smoother payment experience. For these individuals, we’d expect to see payments come in more quickly – and in doing Read More

1007, 2018

It’s Time to Re-evaluate your Accounts Receivable Business Process

By | July 10th, 2018|Categories: Blog|Comments Off on It’s Time to Re-evaluate your Accounts Receivable Business Process

As we approach the halfway mark of 2018, it’s safe to say that the challenges many faced through 2017 continue to persist this year. Between the threat of bankruptcies, customer loyalty reaching all-time lows, and the emergence of Amazon as a threat to most business in some form - success in today’s market continues to become an increasingly complex proposition. Now, I understand that some readers may look at those threats and dismiss them as irrelevant - a common reaction, I’m sure, by many of the businesses that now find themselves dealing with the fallout of the challenges identified above.   At the end of the day, business boils down to a financial transaction whereby one party provides something of value, which the other party provides economic compensation for. Simple, right? Why is it, then, that this financial exchange continues to be one of the more difficult areas for a business to maximize efficiency in? 11% of customers don’t receive the invoices you are sending ( 52% of receivables are lost when businesses (willfully or otherwise) allow them to age past 90 days (Atradius). It’s clear there’s a problem, yet the “tools” of the trade have remained similar for over Read More

1406, 2018

Should CFOs Care About Customer Experience?

By | June 14th, 2018|Categories: Blog|Comments Off on Should CFOs Care About Customer Experience?

According to a report by Accenture, 90% of business-to-business (B2B) executives point to Customer Experience (CX) as a critical factor to achieving their strategic priorities. However, only 20% of B2B companies excel at CX, presenting a huge opportunity to capture new revenues by increasing focus on CX and making investments to improve. Conversely, a whopping 80% of B2B companies are at risk if they do nothing, as they will see their revenues bleed away to competitors that make the change. So you may be wondering what does CX have to do with a CFO and why should the CFO care? Isn’t CX a marketing responsibility that belongs to the CMO? Both are great questions and the answers are simple. Most CFO’s will tell you that their top priority is to act as a steward of working capital (WC) and to manage inbound and outbound cash flows, ensuring that their company can continue to operate in good standing. Inbound cash flows are revenues that will be driven largely by CX as more and more companies optimize customer experience in order to compete in a competitive marketplace. See where am I going with this? Visionary CFOs planning for the future financial health Read More

406, 2018

Treasury Modernization – Are Banks Missing the Boat?

By | June 4th, 2018|Categories: Blog|Comments Off on Treasury Modernization – Are Banks Missing the Boat?

While commercial clients account for, on average, less than 15% of bank’s clients, their deposits often represent over 50% of total deposits. So why aren’t banks innovating and modernizing their treasury products and offerings to better serve this important commercial base? Driven by the need to keep up with consumer expectations around payments and mobile apps, banks have prioritized innovation around their personal banking divisions. Think of how drastically payments have changed in just a short time, with seamless payment processes of an Uber ride, P2P e-transfers, and mobile payments such as Starbucks to make consumers lives easier. Commercial Clients Are Expecting More Commercial clients are beginning to request these same innovations for their finance teams. “Why can’t we have business payments and mobile apps like I have in my everyday consumer life?” The shiny new toys in retail banking are now giving way to the need to innovate on the commercial, side as commercial client expectations are changing. In speaking with many of the banks in attendance at this year’s NACHA Payments and Finovate fintech shows, treasury departments are starting to accelerate research around commercial innovation and fintech solutions. What was “18 months down the road” is happening now Read More

1805, 2018

Do Tenants Really Pay On Time?

By | May 18th, 2018|Categories: Blog|Comments Off on Do Tenants Really Pay On Time?

I talk with commercial real estate (CRE) property accounting teams almost everyday. One complaint that I hear again and again: tenants regularly miss their rent. This may be surprisingly to most, but after a couple of years of hearing the same message day in and day and day out, I now understand why. CRE accounting teams just can’t continue to manage their collections process the same way they always have. A process that more often than not, involves a property manager knocking on the door. So how can property accounting teams start to think differently? Here are some insights on how to address this as an organization, how to begin to think about collections differently, and most importantly, to start getting paid on time. Communication is key, and not just at signing. Sign a lease, agree to the terms, and off we go. If only it were that simple. With just about every vendor or service provider comes an invoice or bill which requires payment. Real estate is unique. In most cases an annual rent statement goes out by paper with the agreed upon terms and then tenants are left to their own devices to pay. This is one form Read More

1405, 2018

Strategies for Optimizing Your Accounts Receivable (Updated for 2018)

By | May 14th, 2018|Categories: Blog|Comments Off on Strategies for Optimizing Your Accounts Receivable (Updated for 2018)

While customer-centricity, disruption and innovation continue to be keynote themes at conferences this year, teams across North America continue to power their day to day operations with the same tools and approaches they were using when the Y2K bug was dominating headlines. Today, I’d like to share some inspiration with you around the topic of optimizing your accounts receivable process, with a focus on the shift in mindset that leading companies are adopting as they prepare their teams to drive an exponentially greater impact on DSO and working capital through 2018 and beyond. Across industries, leading AR teams are prioritizing the delivery of great experiences, an emphasis on the importance of the customer relationships, and a shift towards working in real-time. Let’s unpack each of those in a bit more detail. 1. Deliver Great Experiences The reality is that the benchmark for great experiences is not being set by B2B organizations today - it’s being set by the B2C brands that have recognized that digital platforms are a primary interface with their customer base, and continue to iterate on ways to create frictionless interactions for their customers. While the accounts receivable process continues to heavily rely on offline touchpoints (printed Read More

905, 2018

5 Reasons To Take A Holistic Approach To Your Accounts Receivable Process

By | May 9th, 2018|Categories: Blog|Comments Off on 5 Reasons To Take A Holistic Approach To Your Accounts Receivable Process

I recently attended a convention keynote where the presenter spoke to the impact the Fourth Industrial Revolution on all aspects of business. This Fourth builds on the digital revolution, with the fusion of emerging technologies that are growing at an exponential rate. It is disruptive, especially with the recent focus on RPA and AI, with automation leading the charge in all aspects of our lives, professionally and personally. Yet when we think of one of the most fundamental areas of finance, Accounts Receivable, we still see AR teams taking a traditional approach, full of manual processes, disjointed practices, and segmented core functions, such as presentment, collections and payments. So how do these AR teams catch up, scale, and maybe even get ahead of the curve? It’s simple - they need to take a holistic approach to their AR process. Most AR departments only solve half of the receivables problem with their current resources. Here are 5 reasons that you need to take a holistic approach to the AR process: 1. Improving the efficiency of your invoice-to-cash cycle will get you paid faster. As an AR team, DSO is likely one of your strongest - and most feared - metrics. When Read More

2504, 2018

Low Cost Money Taking A Toll On Corporate Finances

By | April 25th, 2018|Categories: Gain Insight Into AR, Save Time and Money|0 Comments

The High Cost of Low Interest is the title of The Hackett Group’s US Working Capital Survey. The survey is available here. The survey is free to download, but registration is required. Hackett’s 2017 survey will be available later this year. James Daly, CEO of Euler Hermes Americas, published an article in based on the earlier survey. Since we know that the Fed’s intent is to keep raising interest rates, left unchecked current practices are going to grow increasingly costly. Both the survey and the CFO article are worth reading. The survey’s conclusion is that “lax working capital management habits learned in easy credit years are starting to take a toll.” The survey calculates working capital based on the latest publicly available annual financial statements of the 1,000 largest listed non-financial companies in the United States, according to statistics gathered by FactSet. The study reveals that in 2016, the 1,000 US companies borrowed another $413 billion, adding 9.3% to their overall debt level, even though cash on hand stayed essentially the same (up 0.4%). These 1,000 companies are $4.86 trillion in debt, more than double their level of indebtedness in 2008. The study notes “that might not seem too Read More

2802, 2018

The Future of Operational Finance

By | February 28th, 2018|Categories: Gain Insight Into AR, Save Time and Money|0 Comments

A recent promotional piece from Deloitte describes how Operational Finance should be the epicenter of upheaval. But Deloitte’s experiences with companies around the world leads it to believe that most companies are “sleepwalking” into this future of inevitability – with nearly 50% of the time currently still being spent on data extraction and modelling, leaving precious little time to support decision-making and change management. Deloitte’s cross- industry benchmarks indicate that more than 60% of the time spent within the entire Finance function is spent on operational Finance activities. Many of these activities are still manual, where the median performer: Processes 23% of accounts payable vendor invoices automatically Processes 59% of accounts receivable customer remittances automatically Has automated 19% of total key controls   Sound familiar? Deloitte says each organization should ask where it sits on the evolutionary spectrum. Today, the role of the CFO is under greater scrutiny, internally and externally, and faces never-ending pressure to cut costs, grow revenue and ensure control. Economic uncertainty, increased regulatory requirements, financial restatements and increased investor scrutiny have forced them into the spotlight. It’s not surprising that CFO turnover is on the rise. Deloitte has advice: Establish the strategic direction to understand the Read More

612, 2017

3 Secrets You Didn’t Know About Accelerating Collections

By | December 6th, 2017|Categories: Blog, Collect Smarter|0 Comments

When it comes to the invoice-to-cash process, the most common pain point next to cash application is collections management. If you’re in finance you can relate to the manual steps, time-consuming efforts, and constant back and forth with customers... all while your receivables continue to rise. The collections frenzy is all too real in organizations today. Collections teams are in a sense firefighters: they put out raging fires, respond to collections crises and rescue the cash they’re owed from bad debt. Once they’ve put out one fire, it’s off to the next one burning down the street. A common trend for most organizations is to fix this issue by adding headcount, this, however, is a temporary fix. Not only do collections continue to rise, but also the number of people needed to manage it. The result? More overdue accounts, handled by a growing collections team. This situation is not fiscally sustainable. So how can you better manage the collections challenge? First, we must recognize the nature of collections: traditional, reactive and lack of real-time insight. In a manual process, collections data represents a static point of time (ERP reports, XLS sheets), narrowing your team’s view of overdue accounts to a rear-view Read More

1911, 2017

The Deloitte Working Capital Series

By | November 19th, 2017|Categories: Blog, Save Time and Money|0 Comments

Deloitte has published its Working Capital Series, that includes Strategies for Optimizing Your Accounts Receivable; Strategies for Optimizing your Accounts Payable; Cash Management; and Strategies for Optimizing Your Inventory (read report here). I enjoyed the Strategies for Optimizing Your Accounts Receivable. It is a short and worthwhile read. The series argues that given the cost of new capital, no business can afford to let its existing capital go to waste. However, often a business doesn’t realize how much cash is trapped on its own balance sheet. Freeing up that cash – by optimizing its working capital – delivers more than improved operational efficiency. It also gives a company the added liquidity it needs to fund growth, reduce debt levels, lower costs, maximize shareholder returns and even outperform its competitors. The article notes that most businesses have AR policies that dictate when to bill, how much to bill and when to collect. Unfortunately, not all businesses enforce those policies effectively – or even adopt the right processes at all. In many cases, it comes down to culture. A business that prioritizes sales often falls into the trap of extending credit to customers, offering discounts or ignoring payment terms if it means Read More

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