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 (CFO.com). 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 a decade now. The good news is that we’ve seen technology improve efficiency in both our personal and professional lives – and the accounts receivable process is no exception to that.
The concept of “change” continues to be one of the largest barriers standing between companies and their desire to drive a more efficient AR process. Despite apprehension about new processes, competing priorities, or the challenges of selling through a technological solution for a historically manual set of tasks – forward-looking companies are investing in technology platforms as a means to get paid faster and reduce outstanding receivables. While the source of this quote garners some debate online, the concept rings true – “Insanity is doing the same thing over and over again, and expecting different results.” Be encouraged that it’s not all doom and gloom in this post – there’s plenty of time in 2018 to make the changes your business needs to make to transform your AR process and results.
What would a double-digit percentage lift in cash flow and customer satisfaction mean for our business? What would it mean if that was accompanied by a double-digit decrease in your DSO? These are the results that businesses are experiencing as they make the shift to AR processes rooted in automation and intelligent technology. We like to call it the “Show Me The Money!” moment.
At the end of the day, every business needs a champion that sees the future potential in their business, and makes it their priority to see that potential realized during their tenure.
If you’re feeling a bit like Jerry Maquire after reading this and are ready to take that leap, we’re here to support you at each step of the journey. Let us know how we can help you set strong foundations for success in AR for 2018 and beyond!
Katie Canton has been helping companies develop and implement successful social media, content marketing, and marketing communications strategies for more than 10 years. Since joining VersaPay in 2018, she writes on topics such accounts receivables automation, Customer-Centric AR, collections management, and fintech.
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