Accounts Receivable Automation as a Time Saver for SMBs

The digitalization of information is an advancement in technology that can significantly benefit small to medium businesses. Automation equips businesses and employees to streamline processes and save time while improving sales and efficiency.

Automation is also excellent for the modern approach to doing business — remotely. Remote workers and sales are more effective when automation helps processes along and makes everything easier. 

This is why 76% of companies in 2021 have reported using automation, and 26% of those that don’t, plan to get started with automation.

What Is Accounts Receivable Automation?

Before getting into the benefits of Accounts Receivable Automation and how to prepare for it, let’s briefly look at what it is.

First, think about what’s most important to your business. Most likely, you’d have to say it’s your customers and your money. Without these two elements, there can be no business.

So, your accounting department is essential to your business because it deals with collecting payments and invoicing your customers. Along with that, the importance of keeping your customers happy is what keeps your business running.

Account Receivable Automation, also referred to as AR Automation if you want to sound extra smart, takes a modern approach to accounts receivable processes if you want to sound extra smart. This happens through electronic, automated systems that help to minimize repetitive tasks that can be rather time-consuming. 

Why Your SMB Needs Accounts Receivable Automation

Marketing teams need to track time and keep an eye on their projects with ease, and automation can go a long way to making this happen effectively.

Using this approach, your company can save time and money because your employees can avoid tedious processes. Workflows will also see minimal follow-up procedures as a result.

Overdue payments can be a hamper to any business, especially one that is still growing. With AR Automation, your company can streamline payments without putting pressure or any burdens on your clients.

With a well-planned (and designed) invoice reminder, your customers will have a better experience, and you will be paid on time. You can customize the invoices to give your customers a more personalized experience and automate it by adding simple ‘Pay Now’ buttons.

Once you’ve sent an invoice, customers will be given time to make their payments. If they don’t, further steps can be taken immediately without taking any extra steps. Additionally, make sure to provide a fresh variety of payment methods such as cryptocurrencies and digital coins. This way, customers will be able to better manage their digital finances based on a crypto heatmap and will count your company as more flexible than others.

With so many small and mid-size businesses struggling to recover from economic difficulties brought on by the Covid-19 pandemic, automation can be a great IT asset and a way for teams to work productively.

Benefits of Accounts Receivable Automation

There are many reasons why AR Automation can be one of the best decisions you make for your company. Let’s look at some of the primary motivators:

Save Time

Your employees will have a lot more time to focus on other tasks when many of the tedious tasks are taken care of for them.

Team productivity can be negated when members have to fuss with tasks that are really better off being automated.

When you automate your accounts receivable, your company will have a more cost-effective and efficient process. This, in turn, improves cash flow and lets your staff work at a more relaxed pace, which is good for effective time and project management. 

Invoices are sent automatically, which also means no customer or client will ever be billed late.

If employees don’t have to send emails or invoices and contact customers about payments, they can focus on improving customer experiences in other ways.

Save Money

Cutting costs can make a big difference to a company, especially in the current economy. AR Automation solutions play a role in solving cash flow problems like late payments. 

It can waste a lot of money if your team has to send reminders and then reach out to customers when they didn’t pay.

With automation, your company gets the money it deserves without the need to fight for it (which can cost money too).

Employees don’t have to stress about dealing with late payers, and they can finish other tasks in the time they save, making it easier for them to perform with improved productivity and efficiency.

AR Automation pays for itself just by helping your company avoid outdated systems or a team that isn’t as effective in getting invoices paid.

Manual Processes Are Risky

Humans can make mistakes and forget important tasks, leading to problems with payment reminders and collection. AR Automation, on the other hand, will act on time every time.

Creating a list of non-payments and then manually entering it into a spreadsheet (or similar data collection method) is not a mistake-proof process. 

Your employees can note down the wrong information and miss a non-payer or add a customer to the list that has already paid. You can avoid this kind of mistake with AR Automation.

Get Your Receivables on Time

Although not every customer will pay immediately upon receiving an invoice, they are more likely to pay before the payment deadline if you can send automatic reminders through automation.

Delays in payments are more likely to be reduced if you use a quality automation and reminder process. 

Retain the Best Human Elements

Keeping your customers happy is one of your biggest goals regardless of the kind of business you have. Giving them a humanized experience goes a long way towards this goal.

Using help desk software for dealing with your customers is a great way to retain the best human elements. Consider complementing your automation with a well-designed help desk. 

With AR Automation, you can create more customized experiences that make customers feel like they matter. When you’re automating invoicing, it’s also easier to focus more on making it personal because you’re saving so much time. 

You can add elements such as transaction histories, your logo, and even a customer portal for payments to improve how customers feel when making payments.

Key Elements in an Automated A/R Platform

There are several essential elements to remember when using a platform dealing with automation. By being aware of them, you’ll avoid making unnecessary mistakes or not making the most of your chosen platform.

Integrations

Ideally, you want to use other software with your automation processes, such as Sage or QuickBooks. Integrations can help improve workflow and team effectiveness — important for any business. If the platform doesn’t allow it, you may miss out on an even more streamlined workflow.

Electronic Bill Presentment

You need to show your clients/customers exactly where they stand with their billing and what they owe you. Keeping track of expenses is important for everyone, and if you can help your customers with this, they’ll love you for it.

Invoice Reminder

No good AR Automation platform will neglect to provide you with this feature. It’s one of the main perks of automation, and not having it will reduce the benefit of using the platform.

Contactless Payments

Contactless payments are convenient and, in many cases, preferred. If you want to make it easy for your clients to pay you, you need to use an AR Automation platform that has this feature available.

Live Chat Capabilities

This is not a feature often offered by AR Automation platforms, but bonus points if you can find one that has live chat capabilities. It can be a really useful feature.

Organic Online Reviews

An easy way to let potential customers know that they want to work with you or use your services is by showing them what current customers think and feel. A good platform will let you display honest and organic reviews that reflect the quality of your business.

There are also a few things to look out for that you should not have to deal with when using an AR Automation platform.

A platform that requires serious training might not be a good idea, especially if you and your team are new to this kind of automation. It’s also best to avoid platforms that call for development to be done by your team.

Also, try to avoid platforms that want you to export data to new systems. This can become complicated and confusing. Ideally, you shouldn’t use anything that disrupts or changes the workflow other than making it lighter.

Preparing for an Automated A/R Function

Once you’ve decided that you’re ready to go ahead with automation for your business, there are a few things you can do to ensure the move is as smooth as possible.

Double-Check Customer Information

Before you can implement automation, you must make sure all the data you have on your current customers are correct. By finding mistakes or missing information before automating, you’ll save yourself and your team a lot of time and many headaches.

Polish Your Books

You should ensure that all your financial books are up to date and clean. No loose ends should be hanging around to complicate the process.

Analyze Existing Data

It’s best to go through all your financial data to ensure there are no inconsistencies between your records, bank deposit statements, and sales reporting.

Use AR Automation to Enhance Your Business

Automation can make a drastic but good change to how effective and efficient your company deals with invoicing and payments. Using the right platform is important, but it’s also vital to ensure that your focus is on your customers and making your team’s work easier. Increase workflows and customer experiences and enhance the way you do business with AR Automation.

Also, don’t forget to use a good time tracker such as TrackingTime to ensure your team is where they should be so you can reward them!

About the author:

Mark Quadros is a SaaS content marketer that helps brands create and distribute rad content.  On a similar note, Mark loves content and contributes to several authoritative blogs like HubSpot, CoSchedule, Foundr, etc. Connect with him via LinkedIN or twitter.

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