Kolleno Solutions
Kolleno Payments
In our current context, can businesses afford to be reluctant to change? Even though automation has proved over and over to save organisations a great deal of time and money while providing better services, too many businesses still rely on paper invoices and manual processes. Implementing new software might take time, training and creating change within your company’s culture. But the best things in life come when you break from your routine and reinvent yourself. This article will explore the return on investment of automated receivables. If you’re looking to streamline your operations and enhance your collections process, you’ve come to the right place.
A healthy cash flow
Automating your Accounts Receivable is the first step to a healthy cash flow. A healthy cash flow is more than just controlling your liabilities. Of course, if your books exhibit more liabilities than assets, it’s not a healthy cash flow. But if your assets display more Accounts Receivable than actual payments, it’s not a healthy cash flow either. Using an automated solution to power your Accounts Receivable is the key to a healthy cash flow because it can convert your outstanding payments into actual payments, and reduce your days sales outstanding (DSO).
Collecting more
Chasing customers for unpaid invoices takes time and effort, and there’s only so much the human mind can do in a workday. However, AI’s abilities are endless. Therefore, automated receivables are more accurate and more efficient, which will increase your collections rates in the short run and decrease your DSO in the long run.
Reducing expenses and expensive mistakes
Automation also reduces operating costs and eradicates costly data entry errors and misplaced invoices, which are common in accounting departments. Investing in good software results in far more significant cost savings than outsourcing your collection with an agency or making employees spend their time and energy on collections, which can result in human error and even burnout over time.
Optimising workflow and CX
Automation is an operational efficiency game-changer, transforming the employee experience. Employees are more efficient, relaxed, and can achieve more. In turn, this positively impacts the customer experience. PYMNTS’ February 2021 B2B Payments Innovation Readiness Playbook: The Business Case for Automating AR Processes, an American Express revealed that “87% of firms that have automated AR functions are processing faster, while 79% say automation enables them to improve team efficiency, and 75% say it’s useful in providing “superior customer experiences.”
A productive workflow
Artificial intelligence can automate repetitive tasks such as checking incoming payments, creating invoices, or assigning payments to open positions. When your employees spend hours processing invoices and chasing customers for outstanding payments, are they actually adding value to your company? Are they actively driving revenue? The ROI of manual AR management is too low to have your staff waste precious time doing these time-consuming, routine tasks that automation can do better.
By investing in automation, your team can focus on added-value, revenue-driving tasks, and the impact on their morale is significant. Empowered, they are more likely to achieve more and adopt a proactive approach to their work because cumbersome, burdensome tasks are suddenly out of the picture. According to a survey of finance and accounting employees conducted by LemonEdge, 31% of interviewees admitted they planned to leave the industry due to high stress. What were the most common sources of this heightened stress? Heavy workloads (42%) and Time-consuming manual processes (36%). Do we need to say more?
A customer-centric experience
Automation can eradicate invoice mistakes, which is good news for your business and customers. Investing in automated AR management software offers your customer a more professional, seamless experience, starting with payments.
Some advanced automated solutions provide your clients with bespoke payment plans and options and a straightforward Payment Portal which guarantees total convenience to pay via any payment method (Stripe, Direct Debit, ACH or EE transfer payments). Not only is it easy for them to pay you, but with one quick look, your customers can get precise and valuable insights into their payments. Empowered, they feel more engaged as AI-powered AR management solutions communicate with them in a friendly, mindful tone that matches their own.
Better decision-making with valuable forecasts
Better reaction: By recording real-time payments, AR management platforms keep an overview of outstanding payments and enable you to take early action to avoid late payments. Thanks to AI algorithms, it’s easier to identify patterns and trends in your customers’ payment behaviour and history. You can detect, if not predict, payment defaults earlier and minimise non-payment risks.
Better prevention: Thorough creditworthiness checks can help you decide on the granting of credits and the setting of payment terms. With an enhanced customer risk assessment, you can make better decisions.
Better predictions: AI-powered tools allow companies to improve their cash flow forecasts. By analysing past transactions and identifying patterns, AI can help accurately predict future cash flow so that you can better plan and manage your finances.
Takeaway: You reap what you sow?
PYMNTS’ February 2021 B2B Payments Innovation Readiness Playbook: The Business Case for Automating AR Processes, an American Express revealed that “87% of firms that have automated AR functions are processing faster, while 79% say automation enables them to improve team efficiency, and 75% say it’s useful in providing “superior customer experiences.”
Optimised cash flow and increased efficiency, enhanced customer satisfaction, and more insightful decision-making and strategy—this is what you can expect when you leverage the power of automation in your AR management.
Whoever said, “you reap what you sow”, didn’t know you could automate the reaping part. The ultimate ROI of Accounts Receivable management? Working smarter, and more effectively.
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