Accounts Receivable Management Outsourcing – How It Can Help Your Business

Small business owners juggle many roles: sales, product development, customer service, marketing — not to mention accounting and account management. Outsourcing the management of accounts payable makes good business sense for many business owners. If you’re struggling to keep your accounts up to date, here are some reasons why you should consider hiring a specialist to handle your claims.

o A company with healthy receivables is healthier overall. Companies must pay invoices on time and in full as far as possible. When accounts are routinely 30, 60, or 90 days past due, capital in those accounts is tied up and unavailable to purchase new inventory or to cover payroll and bills. Providing credit to customers is necessary and some circumstances justify default, but the longer an invoice goes unpaid the greater the risk that it will become a write-off.

o Accounts receivable management is time-consuming. Consider the typical cycle: a customer purchases an item or service, the customer receives an invoice, a statement is made each month, the customer pays the invoice with a check, and the account is updated with the payment. In some cases, billing a customer is more labor intensive than the product or service purchased.

o Claims processing can be made more efficient, but the greatest benefits come when it is performed by experienced professionals using the best tools. Not every small business can employ a full-time accountant/bookkeeper/collections clerk. Businesses that don’t have software to automate customer invoice/statement tasks lose productivity when these items are created manually. As a result, managing accounts often becomes an expensive business that doesn’t yield maximum results.

BACA JUGA:  Video conferencing technology and education

o Outsourcing your accounts gives business owners and employees the opportunity to focus on activities that build a business. Whether it’s patient care, sales, product development, or marketing, directing attention and energy to these activities can help a company grow even in times of weakness.

An added benefit of hiring an accounts receivable management specialist: it helps business owners protect themselves from sticky situations when a customer is struggling with the payment. A good A/R pro knows how to stand firm with clients, but also understands that protecting the ongoing client relationship is vital for a business owner. Genuine customer service concerns can be escalated back to you, but routine issues can be addressed and business owners can focus on day-to-day efforts.

Total
0
Share