Imagine a ship sailing through rough seas, its captain trying to navigate through the storm while keeping the ship afloat. This is a metaphor for how businesses operate in today’s economy. Just like a ship, businesses face headwinds, and just like a captain, business leaders need to find ways to navigate these challenges and reach the destination of long-term growth.
It’s no secret that businesses today are fighting a tough battle in a challenging economic environment trying to VUCA-proof (volatility, uncertainty, complexity, and ambiguity) their business and keep their financial ship afloat. But, have you wondered what really keeps a business’ financial ship afloat in tough times? The company’s collections management!
Let’s dive deep into the eBook and see how collections management is the key to helping businesses not only survive but thrive in these unpredictable economic times.
Collections management is like a ship’s navigation system. It helps businesses map out their financial course and steer clear of rocky shoals. Key components of collections management include prioritizing collections worklists, scaling dunning outreach, and processing payments efficiently. Think of these as the compass, the map, and the rudder of your financial ship.
A prioritized worklist guides analysts to high-value accounts in the vast sea of accounts receivable.
So, how does it work?
An Auto-Prioritized Worklist provides a clear and organized view of accounts that need attention based on data such as account balance, payment history, and credit risk. This helps the collections team to easily track, prioritize and collect from accounts that are most likely to yield a positive outcome.
Since an auto-prioritized worklist provides real-time visibility into account details, the collections team can also streamline their workflow, improve communication, and make adjustments for a faster recovery of past-due receivables, resulting in a higher profit for the company.
Automated dunning outreach assists collections teams to map a swift course to customer connections and cash recovery.
So how does an automated dunning outreach work?
Automated dunning outreach allows businesses to automate sending different dunning emails for different types of customers, reminding them of overdue payments and guiding them towards making payments on time. This eliminates the need for manual outreach and helps the team to focus on more complex accounts.
Moreover, automated dunning also provides real-time data and analytics on customer behavior and payment patterns, which can be used to identify trends and make adjustments to the collections strategy. For example, businesses can use this data to identify which customers are most likely to pay and target them with more aggressive outreach, thus increasing the chances of getting paid faster.
Frictionless payment processing steers the business’ financial journey toward profit and growth.
While there are many ways to improve cash flow, one of the most effective is to make it as easy as possible for customers to pay their bills. This is where frictionless payment processing comes in. Businesses can achieve this through techniques such as leveraging guest payment pages, introducing electronic payment options, embedding links in their preferred payment formats, and even using AI-powered chatbots to help customers troubleshoot issues.
Moreover, by making payment processing frictionless, businesses can reduce customer churn, and improve the overall recovery rate. And because frictionless payment processing can be integrated with other strategies such as automated dunning outreach and auto-prioritized worklist, businesses can also improve their overall
Short-term storms can come in many forms, such as cash flow shortages or increased customer delinquency. It’s like a storm brewing on the horizon.
Cash flow shortage can make it difficult for businesses to cover essential expenses such as payroll, rent, and inventory. Whereas customer delinquency i.e. when customers fail to pay their dues on time, can put a strain on the business’ financials and create a vicious cycle of missed payments and overdue accounts.
However, with collections automation, business leaders can identify these challenges before they hit and take action to mitigate the impact. This is like preparing for the storm before it arrives. For example, automated dunning outreach and an auto-prioritized worklist can help the collections team stay on top of outstanding payments and minimize the risk of customer delinquency. And by leveraging frictionless payment processing, the collections team can make it easier for customers to pay their bills, making a positive impact on the cash flow.
Once the storm has passed, business leaders can set their sights on long-term growth. Digital transformation of the collections process can help build stronger relationships with customers by providing a better understanding of customers’ payment history, financial situation, and overall creditworthiness. This information can be used to develop more effective credit policies, create targeted dunning outreach, and personalized payment plans to help customers stay current on their payments.
Additionally, by identifying and addressing issues with collections early on, businesses can avoid larger problems down the road, such as bad debt and charge-offs which can have a negative impact on the business’s credit score and reputation.
Overall, just like a ship reaching its destination, digital transformation of the collections process can help businesses reach the port of financial prosperity by improving their cash flow, customer relationships, and overall creditworthiness.
The economy is unpredictable, and businesses need to be ready to respond quickly to changes in the market. Technology can play a crucial role in helping businesses remain agile and effective, even in the face of volatility. One such technology is HighRadius’ collections software.
Trusted by 700+ enterprises and mid-market businesses worldwide, HighRadius’ collections software is designed to go beyond a data-driven platform to deliver intelligence and experience for the office of the CFO. Let’s look at how HighRadius’ collections software can help you collect smarter, and grow faster.
Enhance team productivity, save time on repetitive tasks, and streamline your collections process and performance visibility.
The software delivers a seamless collections experience and makes it easier for the collections team to track, prioritize and collect from customers with a prioritized worklist based on promise-to-pay analysis, aging analysis, and AI-powered customer segmentation.
Moreover, the software provides real-time insights, data analysis, and reporting on each customer account to help collectors make informed decisions and maximize cash recovery. It’s like having a trusted navigator, helping businesses chart the best course through rough waters.
Take advantage of automated correspondence for low-hanging fruits while leveraging Native VOIP calling to collect from at-risk accounts
The software enables touchless dunning for low-risk customers via emails or AP portals with ready-to-use correspondence templates. It also provides the ability to access all correspondences and customer responses within the software itself reducing the hassle of switching to an email platform.
Moreover, the software provides in-built VoIP calling with an integrated dialer to make collection calls. This allows the collectors to instantly log and access notes and call scripts directly through the software and stay on top of at-risk accounts. This is like having a sturdy lighthouse to guide collectors with crystal-clear visibility into customers’ interaction history.
Provide your customers frictionless payment options and a personalized collections experience, even as you grow.
The software helps collection teams collaborate effectively with one-click access to all AR information and the collaboration history of the customers.
Moreover, the software streamlines the payment process and enables you to get paid in just two clicks by leveraging guest payment pages and embedding payment links in the customer’s preferred payment format. This is like having a steady flow of wind in the sails, helping businesses make headway even in choppy waters.
Business leaders need to be like a ship’s captain, ready to navigate through the storms of today’s economy and reach the destination of long-term growth. Collections management is one area that can help them do this. With the right technology, strategy, and best practices, businesses can weather any storm and reach their financial port of call. So set sail, and let the journey begin!
If you want to streamline and automate your collections process, here’s what you can do next:
Automate invoicing, collections, deduction, and credit risk management with our AI-powered AR suite and experience enhanced cash flow and lower DSO & bad debtTalk to our experts
HighRadius Integrated Receivables Software Platform is the world’s only end-to-end accounts receivable software platform to lower DSO and bad-debt, automate cash posting, speed-up collections, and dispute resolution, and improve team productivity. It leverages RivanaTM Artificial Intelligence for Accounts Receivable to convert receivables faster and more effectively by using machine learning for accurate decision making across both credit and receivable processes and also enables suppliers to digitally connect with buyers via the radiusOneTM network, closing the loop from the supplier accounts receivable process to the buyer accounts payable process. Integrated Receivables have been divided into 6 distinct applications: Credit Software, EIPP Software, Cash Application Software, Deductions Software, Collections Software, and ERP Payment Gateway – covering the entire gamut of credit-to-cash.