What is your small business accounts receivable process?
A company takes blood, sweat, and tears to build and then some to run. And if you consider running a company bringing in revenue that turns a considerable profit, then rest assured it is going to suck your soul out. Multiple departments mean multiple levels of the workforce and that much engagement in every aspect. Adequate amount of time and systematic management of every single detail is mandatory, not an option.
Furthermore, just relying on the employees is not sufficient in present-day businesses. Good workspace, plenty of resources – hardware support and software backup – are also crucial.
What exactly is the accounts receivable department and what does it deal with?
The trickiest of all departments is arguably finance. Handling the company’s financial influx and outflux is the deciding factor in what will be the profit margin. The accounts and more specifically the accounts receivable department manages the flow of revenue. It is responsible for the invoice issuing and collecting the payments. The responsibilities of this department are – collecting late payments, collection of any debt, credit applications, invoicing, and many other minor financial proceedings.
Evidently, this department functions to bring the cash in a timely fashion. The capital is required to sustain the business and to further make room for growth. The failure to do so means a wobbly cash flow and an unreliable influx of cash. Obviously, it will not be beneficial for the company and thus needs to be paid rapt attention to.
What is an ideal accounts receivable process?
Imagine a person responsible for bringing you a certain amount of money every month, at the same time. This is the money that you pay all your expenses with. Now, this person is late a given month. That would mean you cannot pay for your expenses and your life ceases to go regularly. This is similar to what happens to a company when the accounts receivable process is tardy or hindered. A good accounts receivable process would manage payments systematically and collect dues early with proper follow-ups on late payments.
One prominent function is credit application approval from new customers. Further setting credit limits to encourage purchases. This is where the accounting department finds the required information to send invoices, also the reports used to collect overdue payments.
All these tasks are even more complicated than they sound which is where accounts receivable outsourcing automation comes into play. Services like easyap specialize in issuing electronic invoices and handling finances. AP accounts receivable outsourcing is not a new concept when it comes to established companies. easyap offers pricing that is based on a point-to-point system so there are no hidden charges or impromptu miscellaneous taxes.
Why should you choose accounts receivable outsourcing automation?
- Automated invoices have made an appearance at every business whether it is small or gigantic. The past few years have also introduced a need to issue invoices electronically which is beneficial to sellers and customers alike. Automating your accounts receivable process by outsourcing it to a third-party service like easyap is the perfectly sensible next step.
- The invoices and any calculation that comes with it are accurate and efficient. A tired accountant is bound to make a mistake, a dedicated software from easyap is not. The need to double-check the invoices before sending them or giving anyone the benefit of doubt is no longer an issue.
- The collection of scheduled payments do not need reminders with easyap. Dues are collected on time and payment reminders are sent to the customer before it’s time to make the payment. Customer relationships which are an important part of the organizational culture, are well maintained if all payment processing is done professionally.
- Real-time updates of your accounts are accessible to you at any point. Using a service like easyap allows your employees to channel their energy and brainpower to more complicated, more rewarding tasks. Saves a lot of money when you do not have to have a team dedicated to the accounts receivable process and can use a one-stop solution like easyap instead.
The profit a company makes is very much the output of the finance and accounts department. By outsourcing the accounts receivable, this heavy load i