Do you spend more time chasing down overdue invoices than you do actually billing your customers? Maybe you should consider automating your accounts receivable (AR) process. According to recent studies, businesses that automate their accounts receivables process can improve their cash flow by up to 20%. Here are six reasons why you should automate your accounts receivables process: 

Challenges With Manually Accounting for AR

In business, accounts receivable refers to the money that is owed to a company by its customers. This can be in the form of goods or services that have been purchased on credit. If a company does not manage its accounts receivable properly, it can have a negative impact on its cash flow and overall profitability.

Organizations typically have to wait 30-90 days or even longer for customers to pay. This can easily throw off your business's cash flow, since it's relying on that income. Furthermore, it can affect your forecasting budget, revenue and profit goals, and overall growth.

Why Automation is Important to AR Processes

There are a number of ways you can automate your AR processes. You can start by using an accounts receivable automation solution that can automate the entire AR process. It can help you manage invoices, payments, and collections so that you can get paid faster. Here's how your accounting firm can benefit from it:

1. Improve Speed and Attain Efficiency

With an AR automation solution, you can make your AR process faster. This means that you can process invoices quickly so that your customers can make the payments quicker. You will also be able to manage the collections process in a more efficient manner so that your customers can get the money they owe you sooner. This way, you can reduce the time it takes to get paid, and you can also make your AR process more efficient.

2. Reduce Costs

Another benefit of using an AR automation solution is that it can help you reduce your accounting firm's costs. With an automated solution, you will not need to hire as many staff to manage your AR process. This can save you a lot of money, which can be used to invest in other areas of your business. In addition, you can also eliminate the need for paper invoices, which can save you even more money.

3. Improve Customer Service

With an automated solution, you can provide your customers with a better experience. This can include providing them with faster payment processing so that they can get the money they owe you sooner. In addition, you can provide them with better customer service so that they can feel more comfortable dealing with your firm. This can help you build a better relationship with your customers, and it can also help you increase your sales.

4. Reduce Past Due Accounts

Another benefit of an automated solution is that it can help you reduce the number of past-due accounts. This is because it can help you manage your collections process more effectively. You can set up your system to automatically contact your customers when they are behind on their payments, and you can also set up your system to automatically send them payment reminders.

Conclusion

There are many reasons to automate your accounts receivable system, and these are just a few examples. Automation can save businesses time, money, and hassle. Ultimately, it will help you provide a better service to your clients and not suffer from delayed payments.

Automation is the key to any company's success, and you're firm is no different. That's why you should get an intuitive solution like Firm360 to help you improve all your processes, including accounts receivables. Whether you need bookkeeping workflow software or client management software for accountants, Firm360 is the all-in-one solution for you. Book a demo today and discover all the amazing features of our accounting practice management software.