The check is in the mail. Yeah, sure. A new study shows 93% of companies are paid late by customers. How late? The average payment is more than a week late creating a ripple effect of more work to figure out who hasn’t paid yet, trying to collect, reconciliation errors, and serious cash flow issues. The issue is so bad, studies show most businesses will write off 1.5% of their receivables annually. The pandemic has made it worse. Some companies are experiencing significant delays and non-payments because their B2B customers have lower sales or are closing down. That’s why automating accounts receivable is all the rage this year.
Accounts receivable automation is the process of making invoices and payments digital. It’s a matter of taking those outstanding bills that customers owe your business for goods and services, called accounts receivable (AR), and making the process simple and fast.
According to PYMNTS this month, 40% of firms still send out paper checks and use postal mail to make B2B payments.
By automating the process, you can invoice and collect payments from customers faster, which can save thousands of dollars if you are borrowing money against your receivables. It can also reduce and eliminate manual work and reduce labor costs. Paper-based invoices that are done manually cost U.S. businesses about $16 to $22 per invoice to process. It will also make your business more efficient and reduce mistakes from human error.
One company changing the game in accounts receivable automation is the software vendor Red Maple in Texas. With its Advanced Credit Cards solution for Microsoft Dynamics 365 and Clever Division software, businesses upload invoices into a web-based portal, and the portal notifies the customer by email or text the bill is ready to pay. The customer can log in anytime at their convenience to pay the bill.
“The idea is when you want to accelerate your AR, you want to make it easy and convenient for customers to pay the invoices. With our software, you make the invoices available immediately and the customers can pay immediately,” says Patrick Hodo, CIO of Red Maple.
“The customer doesn’t have to call you on the phone. They can interact with your business any hour of the day, not just during operating hours. Your customers can use a credit card or bank account to pay their invoices anytime, and in the way they want.”
Red Maple is also one of the only software companies today offering order automation or order acceleration. Instead of calling a business, placing an order and giving your credit card number over the phone and getting an email receipt later that shows what you ordered, Red Maple’s order automation shows you a confirmation of your order before you pay. It also eliminates the need for customers to call and give credit card numbers over the phone.
“It’s like being in a fast-food drive-thru lane and seeing and validating what you ordered. Then, you have the ability to pay when the order is created,” says Hodo. “Our B2B customers really enjoy the ability to be able to interact, order and pay when they are ready. They can pay in any way they choose, at any time, with our easy-to-use processing portal.”
The acceleration processes can also send reminders to customers if their payments are overdue. Since customers can pay with any payment form, at any time, there are no excuses for late payments.
Research about companies that have implemented AR automation show 87% decreased processing times, 79% improved team efficiency and 75% reported superior customer experience. Also, 72% saved operational costs, 62% resolved invoices faster and 60% reported they were able to do more with fewer employees, according to PYMNTS.
When human mistakes are factored out, experts say AR automation also helps businesses manage multiple customers, significantly reduces overpayments and fraud, and makes it easier to optimize cash flow.
This year, experts predict that accounts receivable automation will skyrocket due to the demand for fast and secure processes that help businesses save time, reduce costs and improve their efficiency.
So, if you’re tired of waiting for the check in the mail, 2022 is the year to modernize your accounts receivable and accelerate your order processes.
Red Maple provides many Microsoft Dynamics solutions for retail and software to work help with merchant services and credit card processing solutions.
What software do I need to set up AR automation?
Red Maple can set up the program with our Advanced Credit Cards for F&O and Clever Division software.
How do I protect my customer’s information?
The best way to protect your customer’s information is to use our Clever Division software. It divides your customer’s credit card information into two different vaults. You never have the entire credit card number on your website so hackers cannot steal it.
How quickly can I set up Advanced Credit Cards for F&O and Clever Division?
Typically, we can get you set up within a week.