In business, it can feel like a constant race against the clock. The last thing anyone needs is to have to chase up late customer payments. The reality is; however, an increasing number of businesses are finding themselves in this position now more than ever.
The true lost cost in all of this?
Businesses can recoup this lost time by simply automating their accounts receivables. Here’s both the why and the how.
When a business provides goods or a service to a customer, but does not ask for immediate payment, this is classed as accounts receivables. It is money that customers owe to a business for goods and services already provided. The money is expected to be paid at a set date in the future, and therefore accountants include it as an asset on the business’s balance sheet.
The good vs the bad of accounts receivables
The truth: most businesses don’t expect to ever reclaim 100% of these monies. So why do it? Ultimately, it shows that the business was able to obtain orders, and successfully deliver them to a customer.
Fundamentals for a successful business
When the customers are regular and reliable, there is a benefit from selling goods and services on credit, as it acts as a steady income. Businesses can invoice these customers periodically, reducing costs of processing small transactions, and knowing the invoices will be paid.
- Some other good reasons to sell goods or services on credit are:
- Customers are more likely to buy from you if they do not feel obligated to pay upfront
- They can be considered as assets which are valuable for business viability
- It accounts for items sold (but not yet paid for) on the balance sheet
Why can it become a problem?
Simply… unreliable customers who don’t pay. Businesses will need to absorb the loss of defaults and therefore need to assume that there will always be a certain amount not received. They need to account for this.
When selling to a customer, despite what they say, there is no way of knowing if they can (or will) truly pay. Having too many outstanding invoices in the accounts receivable looks like a troubled cash flow. These payments need to clear on time to be an asset.
There’s always a risk providing goods and services before payment…it just depends whether it is considered worth it in the long run.
Automating your accounts receivables
As you can imagine, all of the above takes up countless hours of manually chasing receivables.This is why at Chaser, we aligned ourselves to solving the problem of late payments for businesses through automatic and intelligent email chasers. To date, Chaser has helped users chase over £3 billion in overdue invoices, without losing the human touch.
How does it work and what are the benefits?
The system works by streamlining all of a business’s chasing activity into a centralised hub. This means they can see every outstanding invoice in one, central location and avoids the risk of chasing too frequently, not at all, or even chasing the wrong customer.
Amongst many other capabilities, the Chaser keeps a track of contact details for customers, customer conversations and even provides data on customer payment history. We have simple templates and schedules that are customisable to individual needs and are stored within the system itself.
This makes it as easy as possible for businesses to quickly send emails that get invoices paid.
Does it work?
Well… let’s take Love Brands as an example
Credit Control Manager, Rossana anticipated that the business saved over 15 hours a week by simply implementing our credit control software into their accounting suite.
When joining Love Brands, Rosanna very quickly identified that the system for credit control they had in place wasn’t working. Business was doing well, but with a very small team of Credit Controllers, keeping up with invoices was verging on impossible.
Rossana asked their existing stock management software provider if they could send automated invoice reminders to clients.
Xero highly recommended that Rosanna try Chaser, and she immediately saw the benefits: “I love how flexible Chaser is. It is easy to use; has great results and I’ve been really impressed by how easy it is to adapt the settings to our continually changing needs. We have saved at least 15 hours per week, and that’s me being stingy”.
Chaser has helped Love Brands to maintain its great relationship with its customers.
We have personalisable invoice reminder templates and schedules which maintain the vitally important personal touch when automating invoice reminders to her customers.
Some of the other benefits businesses see are:
- Money and time saved on chasing invoices
- Recovering more money owed than was ever possible manually
- Maintaining that important customer brand and encouraging customer loyalty
Chaser helps businesses take back control of their invoicing system.
We know that chasing invoices is the last thing a business wants or needs to do. It’s awkward, takes time and often gets overlooked; leaving businesses hoping that customers will simply just pay.
While this might work occasionally, strategically it is not a viable way to run a business if you are offering a “buy now, pay later” service to your customers. At Chaser, we understand that businesses need to operate this way and that invoices can quickly get out of control.
That’s why we designed this system.
To help businesses keep on top of their invoices, in an easy, reliable and customer friendly way that helps to guarantee payment.
If this all sounds like something you need, get in touch and we can get you set up for a free trial.
We know you’ll love it.
What will you do with all those hours saved?