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You can accelerate your cash flow with the digital transformation of your core accounting processes, including your AR (Accounts Receivable) process. Many business leaders agree that the way to keep your business growing is to take advantage of modern technology tools. There are limits to what you can accomplish with paper-based, manual processes. Cash flow optimization is dependent on sound values, efficient processes, and customer loyalty based on positive experiences.
Now, more than ever, with the disruptions of COVID and more employees working remotely, digitization and cloud-based accounting makes good business sense. With an emphasis on customer relationships built on the payment experience, a revamp of your AR processes can set you up for success.
AR Digital Transformation as a business strategy
The ability to collect your sales proceeds and get that cash flowing into your business includes various AR processes, including invoicing, payment acceptance and processing, and collections management. If these procedures are manual and paper-based, the entire cash flow process will be sluggish and inefficient. When you prioritize digitization of your AR process, you’ll gain a considerable advantage over competitors that still rely on manual processes. Every step of the process will be faster and more accurate.
CFOs increasingly view the modernization of accounting processes as fundamental to business efficiency and customer satisfaction. Here are three reasons to consider AR digitization now:
Manual invoicing results in payment delays
Employers and workers are adjusting to a more remote, virtual working environment. Many employers say they would like to see this continue even after restrictions are lifted, and employees agree. Remote work is dependent on cloud-based computing as the only way to allow accessibility and collaboration among teams. You can no longer count on manual processes such as printing and mailing paper invoices that require staff to be in the office. The failure to modernize and digitize does more than invite payment delays—it directly inhibits cash flow.
Improved cash flow starts with automating invoice delivery. When done manually, businesses take an average of 10 days to process an invoice, and payment can be delayed up to 30 days. You can circumvent this issue and eliminate the long lead time by automatically delivering invoices, statements, and supporting documents online.
Now you can upgrade your invoice delivery method by taking advantage of shared online portals and multi-channel invoicing options. Allow your customers to choose the invoice format that best suits their needs. Digitization also allows you to audit and track the delivery and ensure payment information is received where and by whom it’s needed.
Customers want digital payment options
The use of paper checks has steadily declined since other payment options have become available. Many B2B (Business to Business) customers now choose to pay digitally. And many prefer to do business with companies that offer them choices. Business buyers are also consumers and know they can expect similar flexibility in how they purchase and pay. These options can be made available to your customers when you adopt accounting digitization.
Most consumers and businesses now prefer to pay by credit card. Other preferred payment types include ACH, wire transfers, virtual cards, and real-time payments. Acquiring the ability to accept digital payments is a necessary first step in digitally transforming your AR department.
Enabling your AR team to accept and process digital payments will impact the overall health of your business and accelerate cash flow. It will also decrease expenses, reduce manual labor, and provide a more satisfying interactive experience.
Cloud-based collaboration is critical to optimizing payment collection
Efficiently getting your invoices out is only half of the cash flow equation. You need to increase the speed of collection. An inability to collect payments promptly can interrupt cash flow and impede growth. Without a structured, sustainable approach to managing past-due invoices, your AR team can easily get overwhelmed and be forced to prioritize only the highest unpaid balances.
Digitization presents an opportunity for businesses to collaborate over the cloud with their customers to facilitate collections and substantially reduce the volume of past-due invoices. By leveraging technology that enables and fosters collaboration, businesses can simplify how they communicate with customers, automate routine operations, and eliminate manual intervention.
Drive efficiency and cash flow through automation
Digital transformation is here to stay, and more and more companies are gladly jumping on board.
Businesses can automate virtually all routine AR tasks in the cloud by digitizing accounts receivable, including invoicing, reminders, payment processing, collections and dispute management, and invoice matching and reconciliation.
Are you ready to see how AR digitization can transform your company and optimize your cash flow? Contact our experts at Versapay.
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By Versapay, www.versapay.com
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