By Andre Litali, editorial and business content editor at Cadre Dirigeant Magazine, Paris 2022
In the course of running a business, it often happens that part of the sales generated by the company is held by certain customers. In such cases, a policy needs to be put in place to recover the funds, without jeopardizing customer relations. This is where debt collection software comes in. What are the benefits of using debt collection software? Find out more in this article.
Save time and administrative effort
One of the difficulties in collecting a company’s receivables is the time employees waste chasing after customers. A good collection software can automate this task, freeing up employees for other, more important work. This saves you time and administrative investment in recovering your funds.
Depending on the customer, different types of scenarios can be defined for automatic dunning. With this option, you no longer need to spend additional resources to recover unpaid invoices. All you have to do is define the number of steps in each customized scenario and the deadlines. Once the payment deadline has passed, the system automatically triggers the reminder. Isn’t that great?
Thanks to collaborative software such as Aston AI or Upflow, you can avoid oversights and delays in your collections activity. Your staff will be able to concentrate on specific telephone reminders.
Reduce overdue payments
As a service provider, you will never have the same categories of customers. So it’s up to you to identify which of your customers are at risk, a feature offered by good collections software. Based on this categorization, you can then define a personalized dunning scenario. This is seen as a reminder to customers. It enables them to make arrangements in advance to honor their commitment.
Since in most cases, unpaid invoices are due to a lack of liquidity, you can drastically reduce insolvency through automatic reminders. You also have the option of imposing an outstandings limit according to each customer’s possibilities. This will help you avoid periods of cash flow slump by limiting unpaid bills.
Reduce payment times
The problem of unpaid bills can be solved in a different way by making online payment available to customers. The good news is that a computerized receivables management tool also offers this functionality. This means that, on the first reminder, customers acting in good faith can easily discharge their debt to you. In a way, this reduces the time it takes to pay.
This method enhances your communication skills with specific upstream reminders, enabling you to anticipate any disputes that may arise.
Improving customer relations
The various options offered by a receivables management tool are an opportunity for you to make your company more visible. Your personalized reminder scenarios are in fact opportunities to communicate the different offers and payment methods you propose to customers. In other words, every customer needs to feel involved in your various proposals.
In addition to online payment, good collections software also supports bank transfers and other forms of payment. By using such a tool, each customer, depending on his or her category, will feel taken into account by your company. To achieve this, each of your reminders and communications must include payment methods and related documents that are visible to the customer.
Grouping your data
Good receivables management software allows you to consolidate information about your receivables. The information you’ve been struggling to gather in the meantime can now be recorded and available at any time. The software tool enables you to record receivables, customers and stocks at the same time. For receivables, you’ll need to enter amounts, promises, type of payment, etc. into the tool.
As regards the customer, you need to save the following information about him: his account, his outstanding balance, any disputes with the customer and his payment rating. In terms of actions, you need to save the dunning program, the means to be used for dunning, and the status of dunning notices already issued.
Ultimately, a good collection tool saves time, reduces the number of overdue receivables and the time it takes to pay them, makes it easy to consolidate data and improves the relationship between a company and its customers.
ASTON AI Cash Collection: collection and credit management software
