Don’t be lulled into assuming that your AR team is not meeting objectives simply because customer AP departments don’t want to make payments on time. Customer AP departments are not always or entirely the reason why your payments are late. In fact, AP departments usually want to make payments on time to avoid problems with auditing, vendor relationships and cash forecasting.
The collection problems your AR department is having may be homegrown. Your email issues may be causing your late payments. Walt Kelly, the author of the Pogo comic strip, coined the phrase “We have met the enemy and he is us”. Consider these whimsical words of wisdom before you automatically assume customer AP departments don’t want to pay on time.
Email Issues
Sometimes emails are snared in customer AP spam folders because they contain words that trigger spam filters. Since many AP departments are buried in the new normal, you’re lucky if a regular email is read. Spam emails are rarely screened and read.
In other cases, emails are sent to the wrong email address. Personnel in customer AP departments can change frequently, and AR departments are not always notified of changes. If the email address in the customer’s master data is a personal address instead of an AP department address, which is often the case, the response will be either a delivery failure notice or nothing at all.
Theses email issues can be avoided if your AR department implements new processes such as:
Email Subject Lines
Creating subject lines in your emails that don’t contain words that will trigger spam filters can help to get your emails to the recipient’s inbox. Avoid using words that sound pushy, needy, manipulative or far-fetched in your subject line. It can also help to A/B test subject lines to find the ones that are the most successful in avoiding spam filters.
Self-Service Portal
Providing a self-service customer and vendor portal makes it possible for them to self-manage their master data including updating email addresses. Customers and vendors want the convenience and flexibility of self-service. It’s a win-win-solution for you and your business partners.
Accounts receivable automation can help to reduce or eliminate the reasons for getting paid late. Automation makes this possible by eliminating or reducing the road blocks and delays that can cause late payments. Automation increases efficiency, reduces costs and results in increased profits, cash flow and shareholder value.
Lockstep Collect, a leader in cloud-based credit and collection platforms, can help you collect cash in 4 ways:
- Cloud-based solutions
- Automated customer communications
- Customer self-service
- Collections Activity Management
Lockstep Collect is an experienced software partner that can help you maximize your collections and cash flow in the new normal.
If you would like to learn more about how you can benefit from automated credit and collection solutions, please contact Lockstep Collect at www.lockstep.io.
