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Mary runs a construction company, and before automating accounts receivable, her invoices were always late.
It took years of hard work and dedication to build her company's reputation, and now that new and bigger projects were coming in faster than ever, she felt the company's growth was not keeping pace. The AR management process wasn’t what you’d call “up-to-date”. All repetitive tasks were done manually, and it was impossible to keep up with the demand.
That's when Mary decided to switch gears. She implemented an automated accounts receivable system, and the change was like night turning into day. Payments began to roll in like clockwork, and the hours once lost to manual follow-ups were now directed toward growth and client relationships.
With automating accounts receivable, Mary's business found its rhythm, ensuring a robust cash flow and a focused team. Now, let's explore how this strategic shift can bring similar clarity and efficiency to your financial operations.
Accounts Receivable Automation aims to harness digital technology to streamline the invoicing and payment collection process. It can be used to meticulously automate the tracking, follow-ups, and recording of transactions, ensuring that services rendered or products delivered are matched with timely payments. These systems are designed to minimize the manual effort traditionally required in managing receivables, thereby reducing operational costs and enhancing efficiency.
The importance of AR automation lies in its capacity to liberate finance teams from repetitive tasks, allowing them to focus on strategic analysis and actions that can bolster the company's financial health. With automation, the path to increased profitability becomes clearer as businesses can allocate their resources to growth and innovation rather than the labor-intensive processes of the past.
The benefits of Accounts Receivable Automation are tangible and transformative, directly addressing the core needs of modern businesses. Here's how:
Transitioning to automated accounts receivable is a strategic upgrade that can redefine your business's financial operations. Here's a guide to navigating this transition in five actionable steps.
Engage with your sales team, who may have insights on customer payment behaviors; your finance department, who understand the nuances of current receivables; and your IT staff, who will be instrumental in integrating new software. It's a collaborative effort to map out a path everyone can navigate together, ensuring the transition to automation is as smooth as possible for all parties involved.
Addressing concerns head-on is also crucial at this step. Automation amplifies our skills, allowing us to avoid repetitiveness and tackle more complex, rewarding tasks.
Choosing the right AR automation software is like choosing a new CFO: the fit must be impeccable. From our experience, you need to focus on three main factors when switching software:
How do you know what features you should expect from AR automation software? The key is to engage those already in the accounts receivable processes. Their insights are invaluable in pinpointing the exact features, integrations, and functionalities that will make the software a game-changer for your business.
A spotless integration is the secret sauce that makes your AR automation software and accounting software work like a dream team. It's about creating a seamless flow of data that keeps everything in sync. Every software integrates differently, so you must follow their specific steps.
At Arrears, we know that the integration process is one of the biggest struggles for businesses looking for a software upgrade. That’s why we are proud to say we’ve been able to create the most up-to-date, sleek, intuitive, and easy-to-integrate Accounts Receivable software in the market. Not only that, we managed to do it while also adding all the functionalities that an AR team will need to operate at maximum efficiency in today's demanding market.
How easy is it to start collecting with Arrears? As simple as a drag-and-drop of a CSV file.
Identifying the AR tasks ripe for automation is a strategic step towards streamlining operations and bolstering your financial workflow. Here are the ones we think you should focus on.
Automated reminders are a vital function in maintaining a steady payment flow. By setting up automatic notifications through email and SMS, you ensure that clients are reminded of upcoming and past-due payments without manual effort.
At Arrears, we've distilled this process so much that “automation” takes on a whole new meaning. Here is how:
You can take a few minutes to use the AI template generator to craft personalized reminder campaigns that resonate with your clients, use our omnichannel communication system to ensure your message is heard loud and clear, no matter the medium, and use our Smart Timing feature, which analyzes client activity to pinpoint the optimal moment for sending reminders, based on past interactions and payment behaviors.
This way, the outreach process is fully automated and optimized.
Payment plans Customization is crucial for a healthy cash flow. Providing a specific solution that suits each and every one of your customers will decrease resistance to payment, as they can set them up on their own terms. But it would take forever if done manually.
Arrears simplifies this critical process with a self-service payment portal that empowers customers to manage their payments easily. Clients can opt for paying in full or set up automated payment plans, choosing dates that align with their financial planning. This autonomy enhances the customer experience and streamlines your cash inflows, ensuring that payments are received consistently and without the need for manual follow-ups.
Customer support queries can be one of the most time-intensive tasks for any accounts receivable team. Arrears transforms this dynamic with an AI-driven chatbot (GPT-4). By feeding it with your specific FAQs, it learns to address a wide array of inquiries, providing accurate, helpful responses that reflect your company's voice and knowledge base.
This advanced support system is designed to halve your team's message load, allowing them to focus on more complex issues that require a personal touch. With Arrears, support becomes less about deflecting and more about connecting, ensuring every client interaction is an opportunity to impress and inform.
We hate to break it to you, but complete operational efficiency doesn’t exist. There will always be room for improvement, so adopting a posture of continuous optimization is the best you can do to take control of your cash flow.
Cashflow predictability awaits, and it begins with a single step: automating accounts receivable. Check out how Arrears can help you in your journey.
Yes, accounts receivable can be automated. Automation involves using software to manage invoicing, track payments, send reminders, and reconcile accounts, significantly reducing manual tasks and increasing efficiency.
AP (Accounts Payable) and AR (Accounts Receivable) automation refer to the use of technology to streamline and manage the processes of paying bills and collecting payments. This includes automated invoice processing, payment tracking, and financial reporting.
Absolutely, accounts payable can be automated. Like AR automation, AP automation software helps businesses manage their outgoing payments through electronic invoicing, automated approval workflows, and digital payment processing.
An example of accounts receivable automation is a system that automatically sends payment reminders to clients before and after the invoice due date, processes incoming payments, and updates the financial records without manual input. For instance, a company might use software that issues invoices, tracks whether they have been opened, and follows up with tailored reminders via email or SMS until the payment is received and recorded.
