By Analytix Editorial Team
A streamlined accounts receivable system supports strong business financial health. Businesses often have unpaid dues that can quickly morph into overdue debt, eventually seriously hurting the business’s ability to make critical investments.
Overdue client payments are often the first sign of poorly-managed account receivables. If business owners were to personally follow up on all collections, it would quickly prove to be financially unviable for the business. However, even small and simple measures taken on time can help businesses ensure they get paid on time, thus helping organize and streamline accounts receivable better.
Ensuring Client Payments
Businesses should include payment schedules in their sale contracts, ideally these should be built into the agreement. Most businesses determine a time-frame with the help of industry standards as well as needs unique to the business. Invoice scan contain reminders for pay-by dates and payment methods. If a business takes payment by cards online, software can be customized to help them make the payment easily, even on a hand-held mobile device over the internet.
Utilize Software for Business Billing
Payment reminders sent out at the wrong time and for the wrong amounts can put off clients and delay payments even more. Even if most businesses may utilize some kind of software for billing, it is vital to optimize the software. Billing cycles may not be the same for every business, and this goes for clients as well. Analyzing clients’ billing cycles and determining a feasible payment time-frame is significant when customizing billing software.
The process of invoicing must be reviewed when businesses set out to streamline their accounts receivable. Software can help work through receivables, track invoices already sent out, pending invoices, invoices on which some action has been taken, and invoices already paid. Depending on business needs, software can also help calculate variable productive hours to create invoices accordingly, thus freeing up critical time spend in manually doing so.
Enlisting Professional Help
Optimized software is one of the best ways in which to streamline accounts receivable, but even running a software takes time, effort and understanding. Enlisting outside help enables businesses to access expertise that can take over multiple responsibilities easily and with minimum hassle. Outside help can include essential bookkeeping and accounting to complex financial operations, to renting a CFO. Each of these helps businesses ensure accurate accounts, eventually gaining organized accounts receivable and payables. Professional help also means businesses get to ‘catch’ errors that could prove to be costly as time goes along.
Passion and love are often the driving force for successful startups but detail-oriented back-end tasks and paperwork can cut into time and effort needed for business building. What are your views on effective management of accounts receivables? Share your own tips with us in the comments section below. Analytix Solutions offers customized solutions for businesses ranging from traditional accounting and bookkeeping solutions to sophisticated services, including how to better manage accounts receivable. For more information on how we can assist your business, call us at 781-503-9004 or email us at [email protected].