Collection software: why use one?
To facilitate the life of your company and finally have invoices paid on time.
Source : meilleure-innovation.com
If you own a business and issue invoices to customers (for the sale of a product or service), it is very likely that you have found yourself in the following situation: a customer does not pay the invoice on time. This is where the miracles of debt collection software, also known as customer reminder software, come in. In this article, we will explain what it is and what it is used for.
The use of a debt collection software is now common in all large companies, as customers often do not pay invoices on time. With a collection software, the time and energy spent on this task is almost zero, and the rate of on-time payment of invoices skyrockets.
What is collection software?
The debt collection software, or Credit Manager, is a tool that will manage the entire collection process with the help of a artificial intelligenceThe main purpose of this service is to prevent the company from having to pay for the collection of its debts, generally for out-of-court collections, but also sometimes for judicial collections (if the out-of-court collection has failed). tedious and uncertain tasks.
From customizing customer reminders toautomating procedures,establishing credit rules and presenting a collection schedule, good collection software manages everything and has many advantages. ! It plays an important role in establishing good financial health within the company.
It can be associated with an accounting software in order to have a good visualization of the database of the payer profiles, and to avoid double data entry.
5 reasons to use a collection software
So yes, of course, there are lots of different reasons to use such software, but we won’t give you a huge list (that would be boring for you). So we’ve selected the top five reasons to use collection software to give you an idea of the impact such a tool can have.
A tool more adapted than Excel and accounting software
The automation on Excel (or Google Sheets) is very limited, and managing invoices takes a considerable amount of time as soon as the company is a little more developed, as well as for accounting software that is not automated and/or optimized enough for this task. A dedicated collection software will be perfectly optimized and dedicated to this task, which is the perfect compromise.
Restored cash flow
As the software reduces payment delays and allows to visualize the customer’s outstanding balance, the company’s cash flow is more secure and reliable. This allows the company to appear more secure and to invest more easily.
Saving time and convenience
Having a collection software saves a lot of time. Instead of finding unpaid invoices, manually dunning customers… Everything will be automated, including customer dunning, which will save valuable hours. In addition, you will be able to find all the details of your outstanding customers on the software, which will give you a clear and concise global vision.
A more professional appearance
The software works electronically, so everything is automated, with perfect timing. For current customers, this represents a guarantee of professionalism and gives faith in the company. Thus, some financial partners who could be a source of external funding will be more confident about this issue.
A reduction in costs
Of course, saving time means saving money. The person in charge of managing invoices will spend infinitely less time on this task, which makes it possible to either eliminate a position or to assign this person to other tasks that bring value to the company. In addition, the reduction in the delinquency rate replenishes the cash flow.
Why is collection software popular?
Frequently Asked Questions about Collection Software
Why is collection software popular?
In recent years, collection software for businesses has gained in popularity, and not for nothing! When you know that only 40.5% of companies (in 2015) pay on time, the interest of a collection software makes sense, especially with the fact thata company that suffers from late payments of more than 69 days will have 12x more chances to enter default.
What are the main criteria when choosing a collection software?
A quality recovery software will have to respect the following conditions:
– It must be ergonomic and practical to use
– It must be able to be linked to an accounting software easily
You need access to real-time data
-It must allow you to automate a lot
What is DSO?
The DSO (Day Sale Outstanding) corresponds to the average payment period (DMP). This is a widely used term in the collection industry, and is a good indicator of collection performance: the higher the DSO, the more at risk the company is.
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