Manually creating invoices from scratch is a time consuming task. In an office with manual AR processes, invoicing is juggled with other competing priorities. Instead of making invoicing a top priority, manual offices often batch invoicing, invoice periodically (e.g. once a week), or fit it in when time permits.
This haphazard approach has been made even more complicated by remote work. Manual invoicing is more difficult without access to paper files and people at the office. Remote work can lengthen the time needed to generate and send manual invoices. Not sending timely invoices is a big problem for many companies that can be easily resolved with AR automation.
Here are several reasons why it is important to send timely invoices.
Many companies are struggling to generate enough cash flow as they ramp up to meet business demands in the economic recovery. It is vital to invoice ASAP to keep the cash pipeline flowing.
Delay Sends Wrong Message
Customers that receive invoices long after goods have been received may think you don’t care if the invoice is paid on-time, or that it won’t matter because your systems are so lax it won’t be noticed. Invoicing ASAP sends a clear message that you are on top of your AR processes.
May Cause Confusion and Delay Payment
When customers receive an invoice well after goods have shipped this can cause confusion, difficulty verifying the invoice, and result in delayed payment. Customers with manual systems may have problems finding the paperwork to verify and approve an invoice. Late invoices may also raise suspicion that they are not legitimate, and take even more time to be verified and approved.
Collection Problems Increase with Age
The older an invoice becomes the less likely it is to be paid on-time. Late invoices arrive at the customer with the clock already running on aging. They hit the past due column sooner after being received. Even though an invoice is past due, available cash may have already been earmarked for other customers’ invoices. The result is your invoice is pushed out further, increasing the chances that it will be paid late or not at all.
Sending timely invoices avoids these problems. AR automation with automated invoicing increases efficiency, reduces errors, increases cash flow and enhances customer experience.
Accounts receivable and accounts payable cloud-based solutions with customer/vendor portals and digital processes keep vendors and customers connected whether they work remotely or not.
With a connected accounting solution for your accounts receivable and accounts payable teams to coordinate work with customers and vendors, you can go digital and enjoy the benefits of office automation.
Lockstep Collect, a leader in cloud-based connected accounting solutions, can help you boost productivity and optimize cash flow with:
- Automated Communications
- Customer Self-service
- Collections Activity Management
- Reporting & Forecasting
Lockstep is an experienced software partner that can help you increase efficiency and accelerate cash flow.
If you would like to learn more about how you can benefit from connected accounting solutions, please contact Lockstep at www.lockstep.io