An Effective Accounts Receivable Process

Any company that offers credit to its consumers must have an effective accounts receivable procedure. It ensures that payments are collected effectively and promptly, enabling the company to maintain a healthy cash flow while lowering the risk of bad debts.

To build a solid accounts receivable process, remember to take the following important steps:

1. Clarify the terms of payment: Your consumers should be informed of all payment terms, including the deadline and any late fines. By doing this, the likelihood of misunderstandings will be decreased and payments will be made on time.

   
   

2. Use Software Tools: By employing software that enables you to produce and send invoices online, you can automate the invoicing process. Customers will find it simple to examine and pay their invoices online thanks to this, which can also save time and lower the chance of mistakes.

   
   

3. Don't wait to take action on past-due payments: Set up follow-up reminders for past-due invoices, and be proactive in contacting clients to address any problems that might be keeping them from paying.

   
   

4. Provide a range of payment alternatives: Make it simple for clients to pay their invoices by providing a range of payment methods, including credit card, electronic bank transfer, and even the choice to pay in person.

   
   

5. Use credit checks: Consider using credit checks to verify new clients' creditworthiness and lower the likelihood of bad debts.

   
   

6. Establish a payment schedule: If a customer is unable to pay an invoice in full, take into account creating a payment schedule to assist them in repaying the debt over time. This can lessen the likelihood of bad debt and help to keep a positive relationship with the consumer.

By using the steps outlined here, you can create a solid accounts receivable procedure that makes it possible for payments to be collected effectively and on time, enabling your company to keep a healthy cash flow.

Appoynt’s fully managed receivables service provides a simple, cost-effective approach to improving cash flow and profits. If you're looking for an easy way to manage your receivables, talk to our team!