Perhaps the most difficult aspect to deal with in accounts receivable is the overdue invoice. Overdue invoices are a burden on any business, offsetting budgetary goals and affecting the flow of income and expenditures. Automation can help to handle these invoices, but a company must provide effective customer service as well. The best practice is to balance the human element with automation for the most effective means of collection possible, both for customer service and for the bottom line.
Use TechnologyIn a perfect world, all businesses would be run with one accountant for every client. In order to compensate for the lack of manpower, accounts receivable is to elegantly incorporate an automated service. The automated collector must fill in the gaps, promoting simple methods of payment and performing “busywork” to keep your human employees free for the more difficult tasks. Some automation technologies that can be used to facilitate an automated collections process include:
- SMS Texting with past due notices
- Voice Broadcast alerts for past due balances, with key-press payment options
- Email alerts with payment links
Manage Your Human ResourcesAutomated services work best for the customers who pay on time. Individuals who make payments on a deadline do not need the element of human interaction as much. In fact, they often prefer simple methods of payment that do not waste their time. When it comes to those problem accounts, therefore, be sure to shift your human resources in the direction of late invoices. These customers will appreciate the human element in your approach – and they will be more likely to make payments on time in the future.
Look for tasks than can be completed by your automated services more efficiently. The most important tasks, like personal phone calls, should be performed by humans to have the best effect. Other actions, on the other hand, fit well with the automaton’s function, as they may be better suited for the task than another employee. For example:
- Use eBilling platforms like Freshbooks (freshbooks.com) or Xero (xero.com) rather than invoicing clients manually
- Utilize prioritizing platforms to determine which late invoices to handle first
- Make policies for your accounts receivable team to follow when contacting customers
- For more difficult situations, use Funding Gates (fundinggates.com) to set the workflow of the collection process
- Track the time and activities of your employees using apps like Toggl (toggle.com)
Finance managers can identify the tasks that are better for the automated services. That way, the valuable time of your employees won’t be wasted on tasks that computers can perform more efficiently.