Having a lot of customers is a great thing for any business. However, the outstanding accounts receivables of these customers can prove to be more harmful than good. This lateness in payment is one of the major reasons why many businesses fail or run into financial troubles. Thus, having a system in place that manages these outstanding receivables can help businesses stay relevant and functional. So, in this article, we will talk about ‘what is accounts receivables’ and the various ways to process them effectively.
What is Accounts Receivables?
Accounts receivables is the term used to describe the money owed by customers after they avail the goods or services provided to them by a business. They are fundamental to a company’s cash flow and can variously impact the accounting aspect of its business.
Also Read: Why Account Receivable Outsourcing is an Ideal Solution for Medical Practices
The Best Ways To Process Receivables
It can be stressful and time-consuming to follow up on late-paying customers, but tackling them early can save businesses a lot of trouble down the road. Here are a few tips for businesses to do this efficiently.
Providing Customers With More Ways To Pay
Having limited payment options can prove bad for collections as customers are less likely to use methods they are not familiar with. Therefore, allowing customers multiple platforms to turn in their payments can result in a great way to ease their options and also induce initiative on their end.
Offering Financial Incentives
Another way to induce customers to make payments timely is to make the activity worthwhile. Offering small incentives on early payoffs can help businesses get quick payments with decreased customer costs.
Scheduling Regular Reminders
Sending simple reminder emails at regular intervals like every 15 days is also a great way to keep reminding customers of their outstanding payments. It is a much more effective way than simply getting on the phone with clients for providing reminders.
Hiring a Debt Collection Agency
Because accounts receivables are so integral to the revenue of businesses, it makes good sense for them to outsource the process of collection. This allows them to save valuable resources that can now be utilized in administrative and operational functions. The expertise of an experienced collections agency adds good business value as they are well versed in dealing with customers in a manner that is effectively beneficial to the brand value of a company too.
At First Credit Services, we have 25+ years of experience in debt collection services and guarantee you the same quality of service that you would expect from your staff. Many of our clients have experienced a significant reduction in their accounts receivable days and an improvement in reimbursements. Utilizing our services can enable you to free up resources, save money and improve revenue from outstanding receivables like never before.
Contact us today to know how we can help.