Businesses who struggle to quickly collect accounts receivable often believe they have a hard time because they have too few employees focused on collecting invoices. Here’s the good news: Even understaffed accounting departments can become significantly more productive without hiring additional employees; they just need the right tools. Think about it, could your other employees be as efficient without CRM, ERP, or their other business systems? No way!
By replacing manual accounts receivable management processes with accounts receivable management automation software, your collectors can significantly increase their productivity, reduce bad debt write-offs, increase cash flow, and ultimately increasing your bottom line.
A study by The American Collectors Association illustrates how much more productive an accounts receivable management team can be with an accounts receivable automation system:
AVERAGE NUMBER OF CALLS PER COLLECTOR PER HOUR
- Manual: 13.5
- Automated: 17.5 (29% improvement over manual processes)
AVERAGE NUMBER OF ACTIVE ACCOUNTS HANDLED PER COLLECTOR
- Manual: 780
- Automated: 1,713 (119% improvement over manual processes)
AVERAGE NUMBER OF PAYMENTS PROMISED PER HOUR
- Manual: 6.4
- Automated: 10.5 (64% improvement over manual processes)
AVERAGE NUMBER OF DEBTOR CONTACTS PER COLLECTOR EACH HOUR
- Manual: 6
- Automated: 8.5 (41% improvement over manual processes)
Why such a radical difference in productivity levels? A 2013 report from Paystream Advisors explains that automation allows collectors to spend their time in a more valuable way. Instead of spending half of their time with manual data entry, they spend their time reaching out to more accounts and working more strategically. Those collectors who utilize automation are able to reallocate their time away from clerical duties and focus it on communicating with customers, settling disputes, and other more critical tasks that lead to faster invoice collection. For example:
- Those with manual processes spend only 20% of their time soliciting customers for payment, collectors with accounts receivable management automation spend 60% of their time talking with customers.
- Collectors with manual processes spend 15% of their time prioritizing their daily tasks. Automaton allows other collectors to spend only 6% of their time doing the same thing so they can use that 8% of their time on something more valuable.
These metrics indicate a significant opportunity for companies of all shapes and sizes to empower their accounting department with the tools they need to enhance profitability and speed up cash flow while keeping staffing costs to a minimum.