Managing accounts receivable is something that should always be taken seriously. It is an essential account that needs your attention in order to ensure that you aren’t losing money and that customers are paying as agreed. Letting these accounts go too long without attention can lead to financial issues. However, it isn’t always easy to stay on top of it. Here are six tips to help you streamline your process:
- Offer Payment Plans
One of the best ways that you can better manage your accounts due is to make it easier for your customers to pay their past due bills. Giving them the option of a payment plan can be just what they need to ensure you get your money.
- Use Bank Cash Management Tools
Banks offer many tools that you can use to stay on top of collections and manage your cash flow better. For example, electronic payment systems are a commonly used bank tool
- Give Discounts
If your customers pay off their accounts early, you could offer a discount. This will encourage them to pay early, allowing you to add to your cash flow. The money you lose on the discount will be more than made up for by customers who are actually paying instead of having accounts going into overdue status.
- Make It Easier for Clients to Pay
Make sure that when you are going over your accounts receivable you are looking at your invoices with an objective eye. Make changes that will make them easier to read and understand. Make sure the amount and date due are clear and prominent. Using a format that will work for your customers and for your company.
- Print Up an A/R Aging Report
An A/R aging report will allow you to see all your invoices due and their current statuses. It gives you a clear and complete picture of what is happening with your accounts and makes it easy to see what is due and when it is due at a glance.
- Handle Past Due Accounts Quickly
It’s essential that any overdue accounts are handled right away. You should never let them sit. This only shows the customer that you aren’t really that worried about the fact that they haven’t paid. Make sure you make contact right away. Try to start a dialogue and work out a payment with the customer.
Managing your accounts receivable is something that has to be a focus. If you are invoicing customers, then you will only make money when you collect on those invoices. If you aren’t managing the process, then you will lose money.