Why are Key Performance Indicators (KPIs) for accounts receivable (A/R) and collection management important? As the accounts receivable leader, you are expected to collect outstanding receivables. Accounts receivable KPIs are important because they provide you with the data you need to manage cash flow with fewer surprises. KPIs help you monitor collection performance, respond to cash flow trends, and make the right decisions with the right data at the right time. Applying KPIs to the collection process will empower you and your team to respond to collections issues that might otherwise fall through the cracks.
Generally, the following is accurate with the odds of collecting past due balances.
A/R KPI metrics with standards, policies, and procedures to keep A/R collection within 90 days is worth the investment. Here are the basic steps to start implementing accounts receivable KPIs for better collection management and improved cash flow. We will cover in further detail in this blog series.
ERP and accounting systems do not include the level of functionality needed to optimize collections. Manually managing collections and KPIs with spreadsheets is cumbersome and time-consuming because there are too many data points, documents, and correspondence to capture and track over time. It is nearly impossible to measure progress and make decisions by manually tracking KPIs.
Modern accounts receivable management and collection software is designed to optimize collections and measure performance. A/R management and accounts receivable collections software that integrates seamlessly with your ERP system can automatically consolidate any pertinent data in real-time dashboards. Your cash flow will improve once sales, credit, and collections can easily check the status of accounts, invoices, and related collections communications. In our experience, customers that implement A/R software realize the ROI (return on investment) in 2 to 3 months:
Download this ultimate guide for expert tips, best practices, and industry benchmarks to help you start using KPIs to improve your A/R and collections efforts.
Accounts receivable and collection professionals turn to us for our expertise in developing and implementing collections strategies and solutions. Businesses across various industries, including wholesale, distribution, food, and beverage, and professional services, use our A/R and collections solution to increase cash flow.
“collect-IT has 100% changed the way we work and has played a big part in supporting the growth of the company. Without collect-IT, it would have been nearly impossible to keep up with collection demands for the growing number of clients.”
Equipment Distribution Company - Tampa, FL
collect-IT is everything you need to manage accounts receivables, control credit, and detect potential issues in one robust collections dashboard. collect-IT is an easy-to-use, flexible, and powerful solution for small and medium-sized businesses. Learn more about collect-IT:
collect-IT provides you with the tools and insights to manage collections, analyze trends and ensure that your customers pay on time, every time.
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