In many corporate settings, there is a specialized team tasked with overseeing the accounts receivable (AR) invoicing operations. The approach adopted by each firm can range from the straightforward act of issuing an invoice with the expectation of payment to a multifaceted strategy involving multiple payment reminders, additional late charges, and other measures aimed at reducing the duration of sales outstanding (DSO).
What is AR Billing?
Accounts receivable billing, often abbreviated AR billing, refers to the financial transactions associated with credit extended by a business when it delivers goods or services without demanding immediate payment. This outstanding sum is recorded as accounts receivable. The AR billing framework encompasses the issuance of bills, the collection of payments, and the follow-up on outstanding debts, which is a standard practice in most companies.
Your company’s revenue relies on your ability to successfully collect payment. If you can improve your billing processes and streamline your late payment management, you can increase your monthly income without bringing in new sales.
Having the right tools to simplify and automate most of the work is the key to improving workflow and success rate. And if you handle recurring invoices regularly, Recur360 can save both time and money while simplifying the administrative tasks.
The Challenges of AR Processing
- Track Payments & Reconciliation – Proper tracking ensures you get paid on time for the correct amount. Missed payments can cause cash flow problems.
- Extended Payment Cycles – When performed manually, the administrative work takes longer and is subject to errors. Keeping your team and your customers on track with regularly scheduled payments makes cash flow more predictable.
- Disorganized Ledger – If your ledger is disorganized, your staff may overlook upcoming bills due or fail to tackle late payments in a timely manner.
- High DSO – The length of time to turn credit sales to cash.
- Poor Customer Communication – Using software to send out accounts receivable invoices at regularly scheduled intervals, your staff can save time and money involved in mailing paper invoices.
- Outdated Policies – Perhaps your policies need some freshening up. If your customers aren’t clear about the terms of payment and payment options, you should set clear terms to eliminate any confusion.
Tackling these challenges requires the implementation of multiple payment options, switching to paperless billing, keeping your CRM up to date, and automating any processes possible to increase efficiency and accuracy.
AR Invoice Processing
Utilizing digital invoicing combined with payment processing can significantly enhance the efficiency of your team. It is beneficial to select a software solution that integrates the capability to issue invoices and collect payments seamlessly. With Recur360Pay, our payment processing feature, you can do both simultaneously.
Choose a flexible system that enables the dispatch of both invoices and payment prompts, complete with a direct link for payment within the message itself. Delivering these notifications or invoices straight to a customer’s email or mobile device can increase the likelihood of immediate payment, capitalizing on the moment it’s top of mind for them.
If your business manages subscriptions or services, monthly billing can be automated, and invoices paid with the simplicity of Recur360’s powerful features for recurring billing.
Sign up today for a free demo to learn how you can get better control over your AR billing.
