HOW TO AVOID LATE PAYMENTSFROM YOUR CUSTOMERS

LATE PAYMENTS ARE FREQUENTDid you know that   94%   of North American companies polled by Atradius reported late payments from B2B customers?

Some even claimed that 4 out of 10 invoices issued are not paid on time , and that it can take up to 3 months to get paid in full.*

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Most companies deal with late payments from their customers, which has an impact on their cash flow. The way the accounts receivable department is managed is important as it plays a vital role in your liquidity. Simply sending an invoice does not guarantee that it will be paid.

WHY NOT? HOW CAN YOU AVOID LATE PAYMENTS?

*Source: ATRADIUS

THE MORE TIME GOES ON, THE LESS LIKELY A CUSTOMER WILL PAY IN FULL.

After 3 months: a company hasa less than 74% chance of collecting the money owed.

After 6 months: the likelihooddrops to 30% .

And after 1 year: there is only a 10% probability of getting paid.*

YOU MIGHT THINK THAT CUSTOMERS WOULD PAY ON TIME IF THE PAYMENT PERIOD WERE LONGER BUT THAT JUST ISN'T TRUE.

THESE UNPAID INVOICES TURN INTO BAD DEBT.

In North America, 2.2% of the invoices sent are never paid and become bad debt.

How much does this represent for your business? Unpaid invoices can have a significant impact on your bottom line!

*Source: blog.e2banytime.com

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Large organizations lose one document every 12 seconds .*

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REASONS FOR LATE PAYMENT

  Complex payment procedures   Errors in the invoice  The invoice gets lost  Disputes about the information in the invoice

*Source: IDC

REDUCE LATE PAYMENTS WITH AUTOMATIONBy automating your accounts receivable processes, you can save time and gain in efficiency improving your liquidity. Here’s how to do it.

GET YOUR INVOICES TO YOUR CUSTOMER FASTERE-invoices, customer portals, EDI, these are all methods that can be used to get invoices to your customers faster. Additionally, now that your invoices are digital you can prove they were sent out. Customers who prefer paper invoices can receive them but by also sending an email they get the best of both worlds.

INCREASE INFORMATION ACCURACY Use automation to analyze your invoices before they’re sent. If the invoice matches the order, it is automatically sent. Employees will only need to process and correct problematic invoices.

TAKE ACTION BEFORE LATE PAYMENTS OCCURAutomate your dunning process and communicate with your customers in their preferred way. Send reminders by regular mail, email, via web portals and even SMS.

DIGITIZING INFORMATION MAKES IT EASIER TO FIND AND AVOIDS DISPUTESAll outbound communications with your customers can be stored in an ECM system automatically. If your customer loses an invoice or disputes the terms or other details, your staff can directly check the information in the system or resend documents quickly.

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