Build the Accounts Receivable Plan to Enhance Your Revenue Flow

Being in a business can be exceptionally challenging. You need to do everything on your own, especially when it comes to small businesses. Business owners need to work on accounts receivable, sales, marketing, HR, strategic planning, budgeting, accounting, inventory, and more. Mastering these skills means recovering past-due accounts from a non-paying consumer. Debt collection services will increase your cash flow. It’s essential to build a proven accounts receivable system that grows along with the business. Here are key areas that every service provider needs to focus on,

Payment schedule system

You already run a billing and collection policy; if not, you must do it quickly. Get it set as soon as possible if it’s not fully implemented and automated. With the help of the billing software, debt collection services will create instant reminders when payments are late. You must also establish a schedule and procedures to follow up. This should become an automated part of doing business. The payment schedule report provides several useful information for cash collection and credit risk management.

Adjust policies

Running a few changes can help you boost the revenue. The key here is to keep the invoice on top of mind for your consumers. When collecting consumer information, you get their permission to call, email, or text a cell phone. It’s more about requiring a deposit before they reach the service. When the bills go out in 30 days, it might be worth sending payment reminders as early as possible.

Follow-ups

You must follow-ups with a phone call or email. It’s equally important to verify that the service gets completed, as if the customer has any questions or feedback, and finish the call by letting the customer know their final amount due and when the invoices are going out. Remember, it’s pretty uncommon for unhappy and dissatisfied clients to ignore the bill or postpone payment. Debt collection services run early contact to head it off. Then, the consumer will voice their concerns and will be able to resolve the matter to avoid nonpayment.

Focus on overdue accounts

If the due date has passed and there’s no sign of payment, now is the right time to follow up with the client comprehensively. This is where small business owners get shy out. However, waiting for your payment is not the best option. It diminishes the chances of recovering your revenue. It’s best to be proactive and step up attempts to connect before the next billing cycle. The process is to start with a courteous email. When nothing comes of that, you need to be persistent. Focus on increasing contact frequency at least once weekly with phone calls, follow-up invoices, and emails.

Streamlining the collection process

Finding new ways to reduce AR isn’t at the top. There’s rarely enough time in the day or week to complete the list, and you must pick what gets accomplished. When managing the day-to-day, sometimes following up on past-due accounts may feel like you’re moving backward instead of forward.

Clarify the cost

The business delivers a product or service. Therefore, you must ensure that the consumers know the pricing before you provide it. Sometimes a surprise cost or unclear pricing can lead to nonpayment or late payment. You can avoid these situations by being clear about costs upfront and establishing how the consumers intend to pay.

Smooth payment facility

Whether you’re taking payment at an office or visiting a consumer’s residence, you need to help create an easy way to pay for services electronically on the spot. Offering the latest payment module, i.e., online payment, credit card, debit card, etc., will enable you to take payment with a smartphone or even a smartwatch.

Stay on top of AR

The consumers have busy lives too. Spying on their overdue account isn’t their highest priority when they go past due. It’s the agents’ job from debt collection services to make it their highest priority. However, you must not put off making a call or sending a past-due invoice. The more you wait, the less the consumers are likely to pay.

Talk to professionals

If a consumer fails to pay after repeated instructions, it’s now the right time to talk to debt collection services. The right business collection agency can help you manage the receivables with a consumer-friendly approach. They can act less like a last-ditch effort and more like an extension of the office, working to recover the revenue and preserve the consumer base.

Data and security compliance

During the debt collection process, you must equally evaluate the potential debt recovery services. The first thought relates to performance or experience, not data security and compliance. Ensuring safe and secure customer data protection reduces the risk when engaging with an accounts receivable management company. Here’s what you need to look for,

Security certifications and audits

Security breaches have become a concern; as a result, collection agencies are now increasing their cybersecurity levels to protect their clients. You must ensure the potential partner offers the latest security certifications. Certifications such as PCI DSS 3.2.1 or a SOC 3 report are vital. But one thing you can search for in this is whether your potential partner’s self-assessments will certify that a collection agency meets the high standards associated with security certification.

Just because a company passes an audit or receives a certification doesn’t mean something won’t change in a month. The agency should also be using a combination of internal audits and third-party auditors to verify their security measures regularly. Confirm that the collection partner performs the audit on a set schedule. If they don’t, they could be putting the data at risk.

Final Wrap

It’s best to verify that you’ve chosen the right collection partner. The company is looking at its culture and core values. You need to check whether they show concern for compliance and data security. Consumers always remain the first choice on the core value list. Companies can make secure decisions through the lens of people. What’s better than working with a professional service provider to meet all your business requirements?