Stress-free accounts receivable solutions for smoother cash flow

Blog | October 11, 2022

Reading time: 8 min
Reduce the time spent on accounts receivable and invoice collection and eliminate the headaches that come with waiting for payment.

There's nothing like waiting for accounts to come in. It can keep you up at night and make you feel like you're swimming in circles. 

What if there was a way to take the stress out of accounts receivable (AR)? 

You'd be surprised how easy it is to get a grip on your cash flow with the right accounts receivable solutions. Read on for tips on how to get started.

The five biggest challenges in accounts receivable (and how to solve them)

The accounts receivable department knows it's not all fun and games and that you must address some genuine challenges daily. From late payments to customer churn, the AR department has its work cut out.

Fortunately, there are several solutions to these challenges. Below, we'll discuss the five most significant challenges in accounts receivable and how you can solve them.

Late payments

Late payments are one of the most common problems faced by accounts receivable departments. When customers don't pay their invoices on time, it can throw off your entire cash flow. Fortunately, you can do a few things to encourage prompt payment.

  1. The first is to offer discounts for early payment. This will give customers an incentive to pay their invoices as soon as they receive them.
  2. You can also set up automatic reminders so customers know when their payment is due.
  3. Finally, it would help if you consistently tracked customer satisfaction levels so that you can address any issues before they lead to churn.

Customer churn

Customer churn is another big challenge faced by accounts receivable (AR) departments. Customers who cancel their service or stop doing business with you can impact your bottom line. To combat customer churn, you need to focus on retention. 

There are a few ways to do this:

  1. First, you can reach out to customers who have been inactive for a while and try to reengage them.
  2. You can also offer discounts or loyalty programs for customers who stick with you for the long haul.
  3. Lastly, it would help if you consistently track customer satisfaction levels to address any issues before they lead to churn.

Billing errors

Billing errors are another common problem in accounts receivable. If you're not careful, it's easy to make mistakes when preparing invoices or processing payments. These mistakes can often lead to late payments or even non-payments from customers. 

It's important to have a system in place for double-checking your work. You may have someone else review your invoices before sending them to your customers, or you could take advantage of AR software that automatically checks for errors. By catching mistakes early, you can save yourself a lot of headaches down the road. 


Collections are a significant challenge that accounts receivable (AR) departments face. When customers don't pay their invoices, it's often up to the AR department to collect the debt. It can be time-consuming and difficult, especially if you're dealing with large sums of money or demanding customers. 

One way to make the collections process more manageable is to partner with a debt collection agency. These agencies collect the debt, so they often have processes and procedures that make getting paid back easier. But, of course, this option is only available if you're comfortable handing over control of your collections process.

Automation software

Investing in accounts receivable automation software is one way to make life easier for your accounts receivable department. It can help with everything from generating invoices to tracking payments can make your collections process more efficient.

Automated AR software can remove the heavy lifting of trying to manage your accounts receivable yourself or through a third-party agency. Addressing these issues head-on can make life much easier for you and your team.

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The importance of accounts receivable management

Accounts receivable management.

It sounds like a dry topic, but it's much more interesting than it seems at first glance. 

In short, accounts receivable management is tracking and collecting customer payments. This process includes issuing invoices, recording payments and following up on overdue invoices. 

There are a few reasons why receivables management is so critical for your business:

  1. Late or unpaid invoices can negatively impact your business's cash flow. This can lead to financial problems and make it difficult to pay bills or meet other financial obligations.
  2. Accounts receivable management helps businesses build strong relationships with customers or clients. When customers know that they will receive their invoices promptly and have their payments recorded accurately, they are more likely to do business with the company again.
  3. Accounts receivable management helps businesses keep track of their income and expenditure. This information can help make decisions about pricing, inventory levels, etc.

In summary, more businesses are using accounts receivable solutions because it helps to ensure the receipt of timely payments, which allows you to avoid cash flow problems.

How do you manage accounts receivable better?

Optimizing accounts receivable can be a game-changer when getting paid on time

But what can you do to turn your accounts receivable (AR) around?

Fortunately, there are a few simple steps you can take to improve your accounts receivable management process:

  1. Use a straightforward billing and invoicing system. This will help ensure that customers receive their invoices on time and that you can keep track of payments.
  2. Follow up with customers who have overdue invoices as soon as possible. The sooner you act, the more likely you are to get paid.
  3. Consider using accounts receivable automation software to help streamline your AR processes and improve efficiency. Implementing accounts receivable automation solutions can help reduce your AR team’s manual work, which means more significant cash flow.
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How to get your money's worth: The benefits of AR automation software

As a business owner, one of your top priorities is ensuring that your customers pay their invoices on time. 

But chasing down payments can be time-consuming and frustrating, taking valuable resources away from growing your business. 

That's where accounts receivable solutions such as AR automation software comes in because it streamlines the invoicing and payments process, so you can stay focused on running your business.  

Here are just a few ways AR software helps you do just that:

Streamlining your invoicing process

One of the most important things you can do to manage your accounts receivable better is to streamline your invoicing process. AR automation software can help you automate many of the tasks associated with invoicing, such as creating invoices, sending invoices and tracking payments. This can save you a lot of time and money.

Staying on top of your collections

Another important thing you can do to manage your accounts receivable better is to manage your collections. AR automation software can help you automate many collection tasks, such as sending reminders, making phone calls and following up with customers. This can save you a lot of time and money.

Improving your cash flow

Enhancing your cash flow is another important thing you can do to manage your accounts receivable better. AR automation software can help you improve your cash flow by automating many of the tasks associated with cash flow management, such as invoicing, payments, collections and reporting. This can save you a lot of time and money. 

If you're looking for a way to streamline your invoicing and payments process, AR automation software is the answer. With automated invoicing, real-time tracking and built-in financial insights, this software will help you get paid on time—so you can focus on growing your business.

Download the ultimate guide to digital accounts receivable

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Get top tips and fresh insights that will help you control your cash flow and your daily calendar of AR tasks.

4 tips on how to speed up your collections

This age-old adage still rings true today, especially regarding accounts receivable. Therefore, AR management is essential to the success of any business since it's the process of tracking and collecting payments for goods and services delivered to your customers.

Here are four tips on speeding up your collections and getting paid faster: 

Send invoices promptly

Make it a point to complete your invoicing as soon as your deliver goods or services to your customers. That way, your customers will know what they need to pay and when they need to pay. Sending timely invoices also shows you're organized. 

Set clear payment terms

When sending invoices, include your payment terms so that your customers know when they need to pay. If you're flexible on payment terms, don't hesitate to let your customers know. For example, you could offer a 2% discount for invoices paid within ten days. Doing so will incentivize your customers to pay early while still getting paid on time.

Send reminders before payments are due

Unfortunately, many businesses make the mistake of waiting until after payments are due to send reminders, which only irritates customers who may already be struggling to pay on time. Instead, set up automatic payment reminders through your accounting software or an online portal to avoid upsetting your customers. Doing so will ensure that you send out payment reminders on time.

Use account receivable factoring

Consider using account receivable factoring if you're having trouble collecting customer payments because it allows businesses to sell their receivables at a discount in exchange for immediate cash. 

For example, a customer owes you $100 with 30 days to pay. You could factor your invoice for $95 and receive immediate payment, less the factoring fee. While this type of financing isn't right for every business, it can be a valuable tool for those struggling to collect customer payments.

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What’s stopping you from using automated accounts receivable solutions?

While managing receivables can often be time-consuming and painstaking, AR software such as credit, cash application, invoicing, collections and payments can help alleviate the pressure. 

By following the tips outlined above, you can take control of your accounts receivable (AR) and get paid sooner than you thought possible.