8 Best Accounts Receivable Strategies

What used to be considered a back-office function has transformed into one of every organization’s largest assets: accounts receivable (AR). Why? Because it deals with one very important asset that doesn’t appear on the balance sheet — customers.

Improper accounts receivable management can lead to devastating results. Businesses in the Americas lose 51.9% of the value of their B2B receivables when they are not paid within 90 days of the due date. (source)

In order to capitalize on these assets, organizations need accounts receivable strategies in place. These eight strategies are excellent starting points for any business interested in achieving best-in-class AR management.

8 Accounts Receivable Management Strategies for a Best-in-Class Process

1. Embrace Technology
   Today, too many accounts receivable departments view technology as a threat to their existing staff members rather than what it actually is — a highly specialized team member. Cloud-based AR solutions are built to empower AR teams to make the best possible decisions.
2. Go Beyond DSO to Maintain Accountability
   Measuring metrics beyond days sales outstanding (DSO) enables your team to track performance, hold them accountable and achieve the results they’re searching for. 
3. Push for e-Invoicing
   Studies have shown that e-invoicing software can result in cost savings between 60 and 80% compared to traditional paper-based methods.
4. Confirm Invoice Receipts
   Whether a company uses electronic invoicing or invoice mailing services - the most common reason customers give for making late payments is the invoice arriving too late, or not at all. 
5. Follow up Early & Often
   Automation tools allow you to easily achieve on-time payment processing via auto payment reminders so that no human involvement is necessary.
6. Optimize Team Efficiency
   As much as one-third of an accounts receivable representative’s time may be spent prioritizing who to call and searching for their information.
7. Offer Self-Service Tools
   According to Forrester, approximately 72% of people prefer self-service options over phone or email support.
8. Use Root-Cause Analysis
   Using automated accounts receivable management tools, your team can identify, track and categorize root causes for late-paying customers, deductions management and other areas.

These eight strategies are an excellent starting point for any business interested in achieving best-in-class accounts receivable management. To truly become the best, make sure to periodically review your process to ensure your approach remains successful.

8 Accounts Receivable Management Strategies eBook

Download the eBook, 8 Accounts Receivable Management Strategies to Make Your Process Best-in-Class. When you’re ready to transform your process, these best practices will be your starting point to success on your financial teams. 

How Utilizing AR Automation can Contribute to These Strategies

From risk management to credit application automation - automizing your AR processes can be key to unlocking growth for your company, allowing these targets to be hit consistently.

Unlock your company's full potential with accounts receivable automation. From reducing risk to accelerating payments, automation helps streamline every step, ensuring consistent results and freeing up resources for strategic growth. It's time to move beyond the status quo and embrace the power of technology.

It all boils down to this: any organization that wants to modernize its accounts receivable process can do so. All it takes is a little help from technology and a willingness to evolve beyond the status quo. Contact Esker if you’d like to see how we can boost your cashflow.