Power of PAYBOX®
How to Minimize Receivables Processing Time
Minimizing receivables processing time is critical for corporations looking to increase AR efficiency and facilitate faster payments. Companies that collect cash at a faster rate not only reduce DSO by about 5-10 percent, but can also increase business efficiency and performance.
Lowering the receivables processing time may also result in stronger cash flow, which is important for the stability and growth of your business. In addition, stronger cash flow can result in increased working capital for reinvestment in short-term business opportunities.
Minimizing Receivables Processing Time
In Q4 2014, Direct Insite partnered with the Blue Hill Research Group to uncover the top goals of corporations for 2015. Banks and corporations were surveyed for their perspectives on accounts receivables and accounts payable processes. The study showed that most organizations struggle with controlling labor costs and customer attempts to delay or stop payment. As a result of these concerns, the top priority for AR and AP processes in 2015 was to reduce receivables processing time.
Key strategies for reducing receivables processing time include:
- Adopt Electronic Invoicing – Online payment processing is a more cost-efficient option and it can reduce receivables processing time by several days. When invoices are automatically generated and distributed, it eliminates the need to print and mail the invoice to the customer, reducing your billing costs by over 50 percent. In addition to providing a more secure distribution process, e-invoicing also allows customers to access and pay invoices at their convenience, enabling you to capture payment more quickly.
- Eliminate Invoice Errors – Providing timely and accurate invoices streamlines AR processes and shortens payment times. Additionally, ensuring that invoices contain accurate information, including billing address and amount owed reduces customer disputes and avoids further payment delays.
- Manage Discounts – Effective discount management creates opportunities to reduce receivables processing time by incentivizing customers to pay invoices more quickly. In addition to improving cash flow, a well-managed discount program can strengthen relationships with customers.
- Simplify Dispute Resolution – Disputes slow down AR processes and create friction with customers. More efficient invoice dispute resolution processes offer both financial and operational benefits by eliminating roadblocks to AR efficiency. Just as importantly, the implementation of technologies that improve your organization’s dispute resolution capabilities can be important resources for maintaining strong customer relationships.
Ready to Take the Next Step to Reduce Receivables Processing Time?
Direct Insite’s technology and team of experts can help improve your company’s ability to lower receivables processing time, resulting in faster payment on accounts receivables. By reducing operational costs, improving cash flow and providing a more efficient environment to process customer invoices, Direct Insite provides the tools to streamline AR in corporations and enterprises.
Ready to reduce receivables processing time? Call us today at (610) 212-2487 or email us at email@example.com for a private demo.