When someone decides to start a business, they spend most of their time planning the services they’ll provide and how they will provide them. How to handle most of the business processes is barely a blip on the radar. Yet, those tasks are vital to the success of your business. Accounts receivable refers to the money that is (or should be) coming into your business. It gives you an in-depth look at the financial health of your business.
Accounts receivable can be overwhelming. It doesn’t have to be that way. Here are 5 things you can do immediately with your accounts receivable.
Make Time to Work on Accounts Receivable on a Daily Basis
It’s hard to know the financial health of your company if you’re behind on posting payments and determining which accounts are past due. Make time every day to work on accounts receivable. Even if you’re behind, you’ll find that devoting 20 or 30 minutes every day to this task will help you get caught up and stay caught up.
If your business has grown to the point that it would take your hours each day to stay caught up on AR, it’s time to consider outsourcing the process. Clients ARM has more than 30 years of AR experience. Providing services from a remote, US-based location, our accounts receivable services cost around 60% less than what it would cost for you to hire an employee.
Automate the Process as Much as You Can
Accounts Receivable can be made easier if you automate as much of the process as you can. This means that you choose the right AR software that allows clients to pay online. The right software will automatically update invoices to show that they are paid or that a payment is being processed. Look for a solution that gives clients the ability to pay via e-check (ACH withdrawal), debit card, credit card, or an online payment processor such as Venmo, Stripe, or PayPal. When clients have the ability to pay online, you’re more likely to get paid on time or early.
Review Past Due Accounts
Collections is part of the accounts receivable process. It’s something that businesses don’t like to deal with, but it’s an important component. Past due accounts affect your bottom line. Open your AR software and pull up a list of invoices that are marked as unpaid. Sort these by the date they are due. Starting with the invoice that has been past due the longest, first consider whether the payment simply was entered into the system. If the account truly is past due, it’s time to follow-up and start the collections process. The longer an account goes past due, the harder it can be to collect on it. Check out our simple debt collection script by clicking here.
Create a Written Guide
It doesn’t have to be extremely in-depth, but it should walk you or whoever will handle your accounts receivable through how you want the accounts reconciled. It should explain how to post payments, how to review due dates, when follow-up should start on past due accounts, and how you plan to handle collections. This helps ensure accuracy and consistency.
Get Help with Your Accounts Receivable
If you’d like to focus more time on your clients and spend less time worrying about your accounts receivable, partner with Clients ARM. With more than 30 years of experience, your accounts receivable will be in the hands of qualified and competent professionals. Your invoices will be kept up to date and you’ll be able to rest assured knowing that you have accurate financial data. Ready to learn more? Schedule your free consultation.