Invoicing is probably the most important and fun thing a business can do. It’s a pleasure to see satisfied customers pay for what you offer, but it can be less fun to administer the billing process itself. For electricity suppliers, mobile operators, wholesalers and other companies with large customer volumes, the process is often tedious, tying up skilled finance staff from doing more fun and value-adding work. In addition, a manual invoicing process can be fraught with risks. Errors in both content and delivery can lead to invoices remaining unpaid. Such mistakes affect not only your financial flows, but also your customer relationships.
Fortunately, there are solutions that manage and simplify the entire invoicing process. This not only gives you time for more value-adding work, but also for better financial flows and strong customer relationships.
Manual invoicing processes pave the way for problems
According to a recent survey by Innovationsföretagen, around 30% of invoices sent in Sweden are paid late. There are many reasons why an invoice is not paid on time. In our own survey of Swedish companies, we saw an increase in customers not paying their invoices on time. Not surprising given that an already high debt burden for companies was compounded by a high level of uncertainty, putting further pressure on cash and liquidity for many companies.
However, unpaid invoices can have many other causes besides liquidity, and manual invoice management can be at the root of delivery problems. Whether an invoice is sent physically or by email, it can get lost or end up with the wrong recipient. An invoice can also be set aside if the customer finds something wrong with it. Some studies suggest that more than a third of all invoices contain outright errors. Manually handling a dispute can be time-consuming and lead to the invoice being sent to debt collection. Moreover, manually tracking receivables is usually a time-consuming process. So sending correct invoices, getting paid on time and maintaining good customer relations is definitely a challenge. Especially if you handle large volumes of invoices.
Get paid faster and improve customer relations with automated invoice management
Invoice management is a great example of where automated business processes not only save time, but also lead to more accurate processing and better customer relations. If you move away from manual invoice management to a solution that can handle the entire invoicing process, including collections, you can solve many of the problems and pitfalls of manual invoice management.
With an automated invoicing process, you can make things easier for yourself and your customers. Especially if you handle a large flow of invoices. The benefits include the following:
Invoices are correct. It is usually the human factor that causes errors in invoicing. With an automated process, invoice documentation and customer data remain correct throughout the process. Invoices go to the right recipient and contain the right information. As a result, fewer invoices are disputed; you get paid faster; and customer relationships are strengthened.
More flexible invoice management. An automated invoice management system can do so much more than just send accurate invoices faster. It can provide you with important features such as support for recurring invoicing (e.g. contract invoicing), or the possibility of payment matching, etc. If an invoice is not paid despite being correct, you also have the possibility of dynamic reminder management and integration with debt collection solutions. This in turn leads to faster handling of unpaid invoices.
Better customer relations. Fewer errors and faster procedures naturally lead to more satisfied customers. If you can also integrate your invoice management with your customers» own systems, you can make the process even more efficient and personalised. For example, through automatically updated customer and item registers, direct invoice import, exportable accounting records and other smart features that provide a more user-friendly and direct customer experience. You’ll have a stronger and more personalised customer relationship when payment is hassle-free. And that can lead to even more business together.
This frees up time for other activities and reduces staffing needs. With a scalable invoicing solution, you don’t have to hire more finance staff when you get more customers. It’s the capacity that will grow, not your staffing needs.
Better insights into identifying both problems and strengths of the company. Freeing up time can mean learning from customer and billing data to make better decisions. An often overlooked strength of automated systems is the ability to extract valuable insights from all the data they handle. Examples include: what sells best; to which customers it is sold; and during which periods. Or which customers are the most profitable; and which ones usually have problems with their invoices. These are insights that can solve previously hidden problems. At the same time, it gives you the opportunity to highlight your main strengths as a company, and to strengthen your customer relationships.
Get paid and keep your customers
Automated invoice management solves many of the problems behind late payments and disputed invoices. But when the problem lies with the customer – whether it’s their ability to pay or something else – you need to resolve the situation before it becomes too complex. Payment reminders and debt collection take up valuable time and incur unnecessary costs – both in terms of lost revenue and extra work. In addition, it may require a well-balanced – and not least delicate – touch towards the customer to collect late payments quickly without damaging the relationship. Could this problem be solved by automating the collection process as well?
Switching to an automated invoicing and collection solution provides a much more efficient process overall. It’s quicker to spot problems and understand what they are. This leads to a more direct and constructive dialogue about the cause of the delayed payment and how to solve the problem. Furthermore, an automated workflow leads to effective follow-up with quick and direct reminders. If both you and your customer can use the same interface, you can more easily go through the details of the case together and resolve any misunderstandings and issues.
If a customer is deliberately dragging their feet on paying their invoices, automated invoice management can keep the debt active and monitor it until it is paid. This gives you a much better insight into your payment processes. When you choose to manage your collections yourself, you can do so in a personalised way that nurtures the relationship with the customer. It also reduces the risk of future collection problems, as you don’t have to spend time and resources on resolving unpaid invoices. And the combination of automated invoice monitoring and the human touch is what helps you get paid while maintaining customer relationships.
Consider this if you are thinking of upgrading or changing your invoice management system
An automated invoice and collection management system solves many problems in the invoicing process. What’s important to remember is that advanced software solutions for managing invoices and collections come in many different forms. They can be customised for different industries, company sizes and needs. To get the right solution for your billing and collection needs, you first need to ask yourself the right questions.
– Is the system scalable? For example, how easy is it to add more features or capacity as you grow?
– Can the solution be integrated with other systems and functions? A platform becomes more useful and powerful when it can be combined with other solutions for e.g. deliveries, credit information or customer relations.
– Can the system be customised to the business? Is it possible to set up functions, rights, etc. according to how we work?
– Is the solution easy to start working with initially? For example, what about onboarding, training and support? How easy is it to collaborate with customers via the system?
– Can we turn to the supplier when we need help and advice? Will we be able to get tips on how to work smarter and more efficiently?
Want to know more about how our invoice management and debt collection solutions can help you work more efficiently? Contact us and we will help you!
