Account Receivables Automation: Software & Best Practices

Financial Automation
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Putting in the work to earn the revenue is only half of the battle. You also have to make sure you actually get paid what you are owed. Accounts receivables automation helps alleviate the burdens that come along with collecting payments, which becomes increasingly cumbersome with greater business success. 

With the right accounts receivable software in place, you can streamline this critical finance function with ease. We’re going to look at what accounts receivable automation software is capable of.

Coming Up

What are the Challenges of Account Receivables?

What Is Accounts Receivables Automation?

How Does Accounts Receivables Automation Work?

What are the Benefits of Accounts Receivables Automation?

What are the Challenges of Accounts Receivables Automation?

What Account Receivables Process Can You Automate?

What are Account Receivables Best Practices?

What Features to Look for When Choosing Accounts Receivables Automation Software?

What are the Steps to Implement Accounts Receivables Automation?

Wrap Up

What are the Challenges of Account Receivables?

The main fact is that CFOs are incredibly busy. Manual and tedious tasks are undeniably undesirable. 

Accounts receivables can pose many challenges, especially when performed manually or tracked across spreadsheets. The downsides include: 

  • Wasted Time: The process is time-consuming by nature. Having to manually track invoices and payments means following up with customers one-by-one, which takes away time that would be better spent on value-added responsibilities. 
  • Mistakes: Human errors are inevitable, and the last place where you want to make mistakes is on invoices. 
  • Late Payments: Chasing down late payments isn’t beneficial to building loyal and happy customers and vendors. Automated payment reminders with accounts receivable software can eliminate this outcome. 
  • Payment Disputes: Without a clear and accurate paper trail or process in place, payment disputes can more easily arise. 

What Is Accounts Receivables Automation?

To avoid the hurdles that come along with manual accounts receivable, many businesses and CFOs choose to utilize accounts receivables automation. In fact, this is just one area in which finance automation can help to transform your organization for the better. 

Accounts receivables automation is the use of a system/software to track, remind, and record payments that your business is owed for services or products that have been delivered. 

With accounts receivables automation in place, your team gains back a lot of time to allocate to responsibilities that require human thought rather than tedious and repetitive efforts. 

How Does Accounts Receivables Automation Work?

Accounts receivables automation does the extra work, so that you don’t have to! The software is prepared to help manage invoicing, analysis of payment trends, collections, extending credit, and reconciling payments that have been received. 

Think about it like this– every month, at the end of the month, you’re tasked with completing the month-end close process. Accounts receivables and reconciliation is at the top of the priority list. 

Rather than having to connect data systems, transform data to perform transaction matching, and make adjustments, finance automation software like SolveXia will do all of this for you. 

Plus, with accounts receivables automation, you no longer have to manually track invoices and payments or send reminders– all of the to-do’s on your checklist will be automated.

What are the Benefits of Accounts Receivables Automation?

Once you implement accounts receivables automation and/or accounts payable automation, you’ll notice the advantages almost immediately. 

Some of the most salient advantages include:

1. Clear Accounts Receivables Process 

When you know where your payments stand at any point in time, you have the knowledge needed to make more informed business decisions. 

Additionally, you’re able to track and see how your processes are operating, and this helps to make any necessary process improvements. With a clear accounts receivables process, you can also track key metrics, such as days sales outstanding (DSO). 

2. Simplified Payment Procedures

Business is naturally transactional. But, at the same time, you want to build long-lasting relationships with your customers and vendors that move beyond just being paid. 

While no one enjoys paying bills, a smooth accounts receivable process can put the payer in the driver’s seat and make them feel more cared for. Personalized smart reminders are just one way that accounts receivables automation can help achieve this sentiment. 

3. Get Paid on Time

Accounts receivables automation streamlines the entire accounts receivables (AR) process. In turn, you are more likely to get paid on time as late payments won’t slip through the cracks. 

4. Scale Your Business

Last but certainly not least, accounts receivables automation enables you to scale your business and grow your transactions without falling behind. 

It’s no longer necessary to hire more people to handle basic and time-consuming tasks that come along with accounts receivables and collecting money. All the while, accuracy will increase. 

What are the Challenges of Accounts Receivables Automation?

It all sounds too good to be true, doesn’t it? Well, it truly isn’t! However, getting started with automation software implementation tends to be the place in which businesses have trouble. 

Once the solution is deployed and everyone knows how to properly use it, there are few drawbacks to be had. 

That being said, let’s cover the basic challenges so that you can do everything in your favor to prevent them from taking place:

Cost

Of course, any software you choose to add to your business comes along with a cost. But, in order to not let the cost be a problem, think carefully about the budget available. Then, start researching solutions within that budget. 

A software-as-a-solution rather than on-premise accounts receivables software will help to alleviate the burden of cost immediately as it offers a more cost effective option. 

Difficulty 

Deploying automation software shouldn’t come as a shock or surprise to your employees. Along with adequate change management, the chosen software should ideally be easy-to-use, no matter one’s technical abilities. 

For example, an automation solution like SolveXia has an intuitive interface with drag-and-drop functionality and pre-existing workflow templates, so that there’s no coding or dedicated IT team necessary to use it. 

SolveXia also integrates with your existing tech stack, so no data gets lost in the shuffle. 

What Account Receivables Process Can You Automate?

Within the workflow of accounts receivables, there are several processes and moving parts involved. Accounts receivables automation is capable and ready to assist in streamlining:

  • Digital payment processing
  • Invoicing 
  • Customer outreach and reminders
  • Data reporting 
  • Transaction matching 

And more! While all of these functions are game changers in themselves, finance automation on the whole can offer even more gains to your business. 

Take SolveXia as an example. The well-equipped platform can automate beyond accounts receivables and execute key finance functions, including: expense analytics, regulatory reporting, APRA reporting, and rebate management, to name a few. 

What are Account Receivables Best Practices?

Accounts receivables automation is surely going to make your business operate smoother. To reap the optimal results, take a look at these best practices and recommendations for your AR process and automation: 

1. Integrate Systems

When you deploy accounts receivables automation software, it will work the best if it integrates with your existing tech stack. This way, all your data and information will be simply connected. 

2. Resolve Issues Quickly

A major reason for late payments is disputes or issues. To avoid moving into the collections phase, it’s best for all to focus on issue resolution rapidly. Follow-up with clients and take action against late payments sooner than later. 

3. Make it Easy

When payment processes are seamless for clients, they are more likely to pay more quickly. Offering multiple payment options is just one way to enhance the experience. 

4. Incentivize Early Payments

It may also be beneficial to incentivize clients with early payment benefits, such as early payment discounts. 

What Features to Look for When Choosing Accounts Receivables Automation Software?

With the array of accounts receivables automation software to choose from, it can quickly be overwhelming as to what to pay attention to. Be on the lookout for a few key functions and features that will certainly elevate the AR automation process, such as:

1. Transaction Matching

When a payment is made, it’s pertinent that it gets applied to the right account. Accounts receivables software will link the payment to the open customer invoice and then mark it as paid. 

2. Automated Communications

For reminders, payment confirmations, and updates, the software should be able to generate automated emails to clients, as well as your team. 

3. Invoice Generation

Creating and sending invoices is the bread and butter of accounts receivables, and it’s also one of the most time-consuming tasks in the process. This is where AR automation should truly shine in saving you time. 

4. Credit Management

If you’re offering customers a line of credit, there’s going to be risk involved. AR automation software may be able to help in identifying customers that are more likely to make late payments or default. 

This knowledge of customer behavior can prevent bigger issues from arising down the line. 

5. Data Reporting

Real-time analytics and knowledge is required for limiting risk and issues. With data reporting and analysis, you can better understand and know your customers.

What are the Steps to Implement Accounts Receivables Automation?

After reading this and making it to this point, you may now be thinking about how you can get started with accounts receivable automation in your own business. There are a few easy steps to follow to make it a fluid endeavor:

1. Involve Stakeholders

When it comes to automation, the more the merrier- in every way. When you get started, be sure to talk to everyone that’s involved in the current AR process. This way, when you implement your chosen solution, it will be tailor made to generate the greatest results. 

2. Communicate Benefits

People may be skeptical at first, but if you are able to showcase the myriad of benefits that come along with automation, they’ll be more likely to be welcoming of the solution. 

3. Integrate Systems

When you have the right solution in hand, connect it with your existing systems to align all your data. 

Wrap Up

Accounts receivables automation is just one of the plenty of key finance functions that is worthwhile to automate. 

Finance automation tools like SolveXia are intended to increase accuracy, streamline processes, remove key person dependencies, and enhance the customer and employee experiences, ultimately. 

Interested to see how automation can transform your finance team? Request a demo with SolveXia today. 

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