Improving your Bottom-Line with AR Automation
June 7, 2020
“Companies can add a few points to their profits with a laser focus on managing what is often their most significant asset – accounts receivable. “
Advanced “cloud” accounts receivable software will streamline and automate cash application, collections, and deduction management, and improve financial results. Continuing with legacy or static ERP accounts receivable software is “low hanging fruit” for improvement.
Like most back-office functions, receivables management was largely a manual affair as recently as twenty-five years ago, and for most companies, it remains an unoptimized area. Even some of the large offshore BPO companies with hundreds of employees still rely on spreadsheets.
Today, with robotics process automation and systems that get better over time by learning, the job of managing credit, receivables, collections, and deduction management can be a holistic, integrated operation that manages the order-to-cash process from customer onboarding to payment. System workflow manages the accounts receivable operation from beginning to payment
Today’s accounts receivable automation is a transformative opportunity for a small investment to drive performance in one of the largest corporate asset classes. Managing inventory turns deserves and gets a lot of attention. Accounts receivables deserve no less attention.
Consider that a $1 Billion (revenues) company may have $150 million of receivables, of which $10-20 million may be over 90 days and at risk. There may also be tens of millions of dollars of accumulated disputes and customer deductions on top of that.
A/R automation also improves the customer experience, eliminating trading partner paperwork and reconciliation of orders, shipments, payments, and even returns. Large buyers (say Walmart, for example) are mandating automation, which is increasingly necessary to do business in mass markets.
For the manufacturer, a tightly integrated billing-to-payment process will assure happier customers and a healthy cash flow. Automating cash application and deduction management will increase profits by eliminating the “revenue leakage” that results from collecting less than you billed.
The Carixa Cloud Suite is a highly advanced solution that can transform accounts receivable operations, from automated credit approvals, autonomous collections with a customer-friendly credit card and e-check payment options, instant deduction reconciliation, and virtually 100% automated cash application. Cartixa employs robotic process automation, to automatically obtain carrier PODs, and to go to customer systems for deduction notifications and for payment forecasting. The software incorporates best practices and delivers an outstanding, friction-free customer experience, and can be implemented in weeks.
The technology to optimize credit to cash billing to payment processes is here now and will continue to improve using AI and RPA. More companies need to recognize how much more profitable they could be by automating these critical backroom operations.