How AR automation benefits your business during economic uncertainty

Blog | June 5, 2023

Reading time: 3 min
A volatile economy can put businesses in a pressure cooker. Here’s how AR and AP teams can be more resilient.
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An economic downturn is something of a rollercoaster. Some industries are hit hard, and others are barely touched. But uncertainty is the common theme—especially when it comes to cash. Everyone wants to get their money in hand and hang onto it as long as possible, just in case.

Prudent? Sure. Stressful for a company trying to manage its accounts receivable and payable? Absolutely. Your customers might be slower to respond, creating more work and more strain on your cash flow.

“Necessity is the mother of invention,” as the saying goes. And while you may not be reinventing the wheel, the pressures from a more volatile market can certainly drive a new way of doing work, including digital processes.

AR automation reduces the burden of manual work

There’s no doubt that slower payments from customers can strain finance and accounting teams. Teams may be spending more time on the phone, more time following up… all with one eye on the digital or physical mailbox, watching for payments.

And on top of that, this increased workload is coupled with decreased staff. Some companies are still recovering from talent shifts in the marketplace due to the Great Resignation.

A 2022 Deloitte poll of hiring managers found that 82.3% of publicly traded companies and 73.7% of private companies expect to have to work hard to attract and retain accounting and financial positions.

The only way to navigate this clash between supply and demand is to reduce the burden of manual work.

AR automation can let finance and accounting teams do more with less, such as onboarding new customers and delivering invoices across multiple channels. At the other end of the payment spectrum, automating your collections efforts can streamline the process, reduce manual outreach efforts, and target the right past due accounts.

Even better: a digital experience supports remote work and appeals to tech-savvy workers. Both are necessary to attract and retain talent.

AR automation leverages self-service payment options

The cost of money is going up between higher interest rates and slower payments from customers who might be stretched thin. Any time trimmed in the order-to-cash process is better for your company and lowers the cost per transaction.

According to our whitepaper, “What’s changing the DNA of the CFO?”, many current CFOs stated that they are facing the most “complex” time in their careers, with cash flow being a top concern. Understandably so: cash flow is the lifeblood of any organization.

But clunky, outdated processes make it harder to get the cash you need in a timely manner.

Digital options can vastly improve your AR processes. You can leverage self-service payment options or easy autopay implementation, to make it easier for your customers and your company. The difference between receiving payments within a few days (or even automatically) versus a few weeks or months can be critical.

Optimize your processes with AR automation

Whether you’ve been through a recession before (can you say “2008”?) or not, one thing is drastically different in today’s world: automation. Finance and accounting teams can take advantage of digital processes to reduce the workload and better manage the inflows and outflows of the business.

In the face of economic uncertainty, it’s tempting not to rock the boat. No one wants to tip over and find themselves struggling to meet the demands of customers or stress out employees by introducing change.

But—counterintuitive as it might be—uncertainty is the time to be decisive. Start with the “easy wins” of automation to remove manual tasks and improve payment processes and you’ll be ready to implement more sophisticated workflows in the future.

The companies that emerge the strongest are those that respond quickly and innovate. They understand that taking on something new (like automation) will ultimately end up benefiting them.

By harnessing the powers of digital processes, AR automation, and even artificial intelligence, your organization can better respond to today’s challenges and tomorrow’s economic uncertainties.