Finding Success In Your Accounts Receivables Department

Your accounts receivables department is one of the most difficult departments to manage on a daily basis. Many owners will find it easy in the beginning, especially when they’re only handling a few clients or orders at once, but that won’t last forever. 

Hopefully, that client list will continue to grow and you will soon have a lot of outgoing invoices and incoming payments. If you don’t properly prepare your team to handle the influx of accounts, you could find yourself in an unorganized and unwanted situation. 

Since many companies will take 30-120 days to pay their invoices, you’ll want to make sure your accounts receivables department is on top of their game at all times. Otherwise, past-due invoices will pile up, some will get forgotten about, and you will have a growing amount of revenue your business might not ever see. 

When managing your accounts receivables, I have several tips that can help you find success and prevent those headaches.

1. Keep Contact Information Up-To-Date

If you don’t have the correct contact information for the company that owes you money, communicating with them will be extremely difficult. They’re already treating you the same way you treat debt collectors when they call your personal phone, but you can at least leave a message if you have the right number or email.

In order to manage this more efficiently, you should have one of your team members check in with your clients every-so-often just to update contact information — especially if you don’t communicate with them often.

2. Carefully Track Overdue Payments

Whether you have an accounting software or use Google Sheets to keep track of your accounts receivables, you’ll need an effective way of keeping everything organized. It can even be as simple as a running list of overdue invoices that you keep on your desk. 

If these invoices get lost in the mix, there’s a good chance you never see that payment. 

3. Follow Up Frequently

Overdue payments are overdue payments, there’s no getting around that. Don’t feel bad or embarrassed if you have to contact your client twice per week in order to get an answer. Remember, they owe you money, not the other way around. 

Of course, you’ll also want to be courteous and respectful. The last thing you want is an angry and annoyed customer.  

4. Consider an Early Payment Discount

Many companies will get creative with ways they can prevent overdue payments. Think about it, your accounts receivables won’t be so jammed up if your clients had an incentive for paying early. 

Something as small as a 5% discount when the invoice is paid early can make all the difference in the world to some companies. Who knows, it could be the reason they choose you over one of your competitors. 

You can also think about doing a discount on future services or purchases for paying early — or even on-time. 

5. Hire a Professional

There’s no greater help than that of a professional’s. If you want your accounts receivable department to perform with excellence on a daily basis, a certified public accountant can take a wide range of stress and anxiety off your work schedule. 

Contact me today if you would like to discuss how a certified public accountant can benefit your business — both for now and for later!

References

“5 Key Steps for Managing Your Accounts Receivable.” Jobber Academy, academy.getjobber.com/resources/articles/5-key-steps-for-managing-accounts-receivable/.