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Put your AR On Auto-Pilot

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Put your AR On Auto-Pilot

  1. 1. PUT YOUR SAGE ERP A/R ON AUTO PILOT TO REDUCE RECEIVABLES BY 20% IN JUST 6 MONTHS January 23, 2012 1:00 PM to 2:00 PM EST by James Mallorye2b teknologies | 521 fifth avenue | chardon, oh 44024 | 440.352.4700 | www.e2btek.com
  2. 2. Small Businesses Still Face Credit Crunche2b teknologies | 521 fifth avenue | chardon, oh 44024 | 440.352.4700 | www.e2btek.com
  3. 3. The importance of A/R Convert AR to Accounts Receivable is cash faster typically the largest or and increase cash flow second largest asset for most businessese2b teknologies | 521 fifth avenue | chardon, oh 44024 | 440.352.4700 | www.e2btek.com
  4. 4. Late Payment is a Serious Probleme2b teknologies | 521 fifth avenue | chardon, oh 44024 | 440.352.4700 | www.e2btek.com
  5. 5. True DSO compared to payment terms Average Days Sales Outstanding (DSO) in the U.S. was 61 days. Average Payment Terms were only 28 days. That’s 33 days – almost a month past terms. You’re a business, not a bank. Stop financing your customers. Net 30 means Net 30 – not Net 60 or pay whenever you want to. Source: atradius press release (9/30/10)e2b teknologies | 521 fifth avenue | chardon, oh 44024 | 440.352.4700 | www.e2btek.com
  6. 6. Customers are asking for longer terms 52% of U.S. respondents reported customers had asked for extended payment terms over the last six months. Source: atradius press release (9/30/10)e2b teknologies | 521 fifth avenue | chardon, oh 44024 | 440.352.4700 | www.e2btek.com
  7. 7. Late payment problems The longer an 26% of invoices 3 months old are invoice goes uncollectable unpaid… …the less likely that it 70% of invoices 6 months old are will ever be uncollectable paid. 90% of invoices 12 months old are uncollectablee2b teknologies | 521 fifth avenue | chardon, oh 44024 | 440.352.4700 | www.e2btek.com
  8. 8. The problem with traditional ERP “In the past, ERP solutions have been woefully inadequate in terms of credit and collections functionality...” (Source: PayStream Advisors)e2b teknologies | 521 fifth avenue | chardon, oh 44024 | 440.352.4700 | www.e2btek.com
  9. 9. Making Collections Easy Who Handles Collections? • Your Office Manager • Untrained Bookkeeper • Part-time AR Clerk • Your CFO or Controller • No Onee2b teknologies | 521 fifth avenue | chardon, oh 44024 | 440.352.4700 | www.e2btek.com
  10. 10. Small Company Cash Flow Why Do Small, Medium, and Growing Companies Struggle With Cash Flow? • No dedicated collections person • No Process • Don’t know how to collect • Don’t understand financial implications • No timee2b teknologies | 521 fifth avenue | chardon, oh 44024 | 440.352.4700 | www.e2btek.com
  11. 11. Making Collections Easy How Do You Handle Collections? • Highlighter and Aging Report • Call in a favor from your brother-in-law Frank • Wait until you can’t make payroll and start dialing • Just send them to third party collections • Put ‘em on credit hold and hope they paye2b teknologies | 521 fifth avenue | chardon, oh 44024 | 440.352.4700 | www.e2btek.com
  12. 12. Automated Communicationse2b teknologies | 521 fifth avenue | chardon, oh 44024 | 440.352.4700 | www.e2btek.com
  13. 13. Putting Collections on Auto Pilot • Send Reminders when Invoices will be due in 3 days • Send Past Due Notice the day after payment was due • Send Account Hold notices after 30 days past due • Mark for Third Party Collections after 30 days past due • Sell off to Factoring after 180 days past due • Escalate to management based on rules: • Amount past due in excess of $10,000 • Days past due in excess of 15 days • Schedule call for collector after 10 days past due • Change credit terms, credit limits, etc. after 3 broken promises Anytime Collect is like CRM – document what you’ve done Anytime Collect is not like CRM – what do you need to do You will be more effective, save time, and improve cash flowe2b teknologies | 521 fifth avenue | chardon, oh 44024 | 440.352.4700 | www.e2btek.com
  14. 14. Assign Tasks in Communicationse2b teknologies | 521 fifth avenue | chardon, oh 44024 | 440.352.4700 | www.e2btek.com
  15. 15. Tagged Invoices to Activities in Accounts Gride2b teknologies | 521 fifth avenue | chardon, oh 44024 | 440.352.4700 | www.e2btek.com
  16. 16. The business case On average, businesses write-off 4% of Accounts Receivable • That’s $400,000 for a $10 million company. • A 10% improvement results in a $40,000 annual savings. • Bad debt write-offs can be as high as 9% in some industries • And some companies write-off much more than that!e2b teknologies | 521 fifth avenue | chardon, oh 44024 | 440.352.4700 | www.e2btek.com
  17. 17. ROI • As a result of automating collections, companies are realizing: • 10 to 20 percent reduction in DSO • 25 percent reduction in past due receivables • 15 to 25 percent reduction in bad debt reserves • increased productivity and ability to hold down staffing costs • Costs of installing the collection software are recouped in as little as two months and in usually no more than six to nine months. PayStream Advisors, 2008e2b teknologies | 521 fifth avenue | chardon, oh 44024 | 440.352.4700 | www.e2btek.com
  18. 18. ROI Calculatione2b teknologies | 521 fifth avenue | chardon, oh 44024 | 440.352.4700 | www.e2btek.com
  19. 19. Demonstratione2b teknologies | 521 fifth avenue | chardon, oh 44024 | 440.352.4700 | www.e2btek.com
  20. 20. Questions Questions? James Mallory jmallory@e2btek.com 440.352.4700 x229e2b teknologies | 521 fifth avenue | chardon, oh 44024 | 440.352.4700 | www.e2btek.com

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