As the CFO or finance lead for your company, streamlining processes and reducing costs are your bread and butter. So, as we emerge out of the pandemic, implementing business survival strategies is quickly becoming a top priority for many businesses. Accounts receivable (AR) automation saves time, accelerates cash flow and generates valuable business insights which can help with strategic planning. The benefits are hard to ignore. So, let’s look at how AR automation can help advance your business.
In this article
AR Automation Saves Time
In a traditional accounts receivable workflow, much of the essential tasks are manual. From invoicing to collections, the processes are heavily paper-based and require a significant investment of manual effort and time. Automating essential functions like invoicing and customer communication cuts down on time spent on data entry, which means that staff have more time for focused strategic tasks that can add value. Reduction in manual processing of invoices also means a reduction in human error and in the time spent to correct these errors. Less effort expended on backtracking, means greater efficiency in processing and a better customer experience overall.
AR Automation Improves Cash Flow
AR automation enables companies to send a higher volume of invoices accurately and efficiently to customers, thereby improving days sales outstanding, DSO. DSO is a measure of the average number of days it takes for a company to collect payment for a sale. With invoices taking a shorter time to arrive to customers, customers gain the convenience of being able to pay instantly and on time which improves the cash flow in an organization. Customizations on invoices, like project codes or purchase order data, facilitates easier matching which allows for quicker approvals and payment submission via customer payment portals. Scheduled payment reminders and dunning notices also work to keep pending payments top of mind for customers, facilitating more timely payments. In addition, automating dispute resolution can help to quickly resolve issues and minimize nonpayment.
Gain Better Visibility with AR Automation
Automating accounts receivable allows for better visibility of the end-to-end AR process. By using data from a single-source-of-truth platform, you can make informed decisions about your organization from accurate and available information. This data can be used to forecast future financial needs and spot potential problems early. Better visibility allows for improved budgeting and avoiding potential cash flow problems.
Accounts receivable automation allows you to improve your team’s efficiency and cash flow and gives you better visibility of the end-to-end AR processes of your organization. Implementing an automated system for your accounts receivable process may be that competitive edge you’ve been looking for. Discover how to transform your accounts receivable process with Cadency.