Managing cash flow shouldn't feel like solving a Rubik's cube blindfolded, right? But for many AR leaders, outdated systems and inefficient processes turn it into a constant struggle.
So, how do you stop chasing overdue payments or wrestling with endless remittance data errors? That's exactly what we explored in our recent webinar, Take Control of Your Cash Flow: Proven Strategies for AR Leaders.
The session included insights from Mark Brousseau, President of consulting services firm Brousseau and Associates, and a fireside chat with Bonnie Halvorson, Financial Services Manager at Van Meter, a leading electrical and mechanical supplies company.
Missed the session? No problem! Catch the recap and full webinar below.
Challenges of conventional AR management
Traditional AR processes often hinder cash flow, with outdated systems and manual tasks consuming time, creating errors, and delaying payments. Limited visibility into payment tracking, static credit evaluations, and invoicing errors leads to inefficiencies, leaving businesses vulnerable to risks and bottlenecks. Customers are frustrated with restricted payment options and cumbersome billing impacting their ability to pay on time. Meanwhile, manual cash application and unstructured collections waste resources and delay revenue recognition.
To thrive, businesses need modern solutions that streamline workflows, reduce errors, and unlock faster, more reliable cash flow.
Removing AR bottlenecks with a holistic approach
Cash flow challenges aren't just about isolated inefficiencies. They come from pain points across the entire AR lifecycle, like credit approvals, invoicing, payment processing, cash application, and collections. So, what's the solution?
“It's not about fixing just one part of the process—it's about fixing the entire process,” says Mark Brousseau. To do that, AR leaders must adopt a holistic approach to AR optimization.
3 ways to optimize AR holistically
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Break down silos
Embrace integrated solutions that streamline every stage of the order-to-cash process. By aligning teams and consolidating workflows, you can achieve complete visibility across operations. From automating credit checks to enhancing invoice presentation and offering seamless digital payment options, unifying these efforts reduces friction, boosts efficiency, and improves transparency. -
Focus on the customer
“Once the sale is closed, the AR team becomes the front door to your business,” Brousseau emphasized. Personalized billing and payment processes ensure customers find it easy and efficient to pay – boosting satisfaction while improving cash flow. -
Invest in technology
Automating and streamlining processes is paramount. It eliminates manual, routine tasks, reduces human error, and frees your AR team to focus on high-value, strategic activities that bring measurable results to your organization.
8 Proven steps to master your cash flow strategies
The webinar focused on eight proven ways AR leaders can overcome these inefficiencies and bottlenecks, increase efficiency, and take control of their cash flow. These actionable tips are designed to improve operational workflows and set your team up for success:
1. Improve remittance data quality
Accurate remittance data is the foundation of healthy cash flow. Try working with your customers to standardize remittance process whenever possible. And when standardization isn't an option, use automation to capture and process data accurately. Remember, small errors in remittance data can lead to big bottlenecks down the line.
2. Transition customers to digital payments
Encourage your customers to move away from paper checks by adopting electronic payment methods like ACH transfers or digital wallets. Consider using incentives to drive digital adoption, offering payment portals that are simple to use, and enabling multiple electronic payment options.
3. Optimize the customer onboarding process
First impressions matter. Set clear payment expectations at the start of every customer relationship. Use automated credit checks to seamlessly and securely onboard customers, ensuring they understand your invoicing policies and payment timelines right from the get-go.
4. Analyze and resolve exceptions strategically
Unresolved payment exceptions can drain time and resources. Regularly review exceptions to identify recurring issues and their root causes. Then, update your strategies to eliminate these pain points for both your team and your customers.
5. Foster collaboration across departments
Engage other departments like Sales and Customer Service in regular AR meetings. Open communication channels can lead to reduced disputes, faster resolution times, and stronger internal alignment, ultimately improving cash flow outcomes.
6. Automate processes with AI and advanced tools
Manual or semi-automated processes are often riddled with inefficiencies. AI-powered platforms like Billtrust can help streamline invoicing, payments, and collections. By automating routine processes, your team can focus on strategic initiatives that add real value.
7. Use AI analytics to identify trends and gaps
AI Analytics tools built into AR platforms provide visibility into payment patterns, DSO trends, and overall cash flow health. Use these insights to adjust your strategies and identify optimization opportunities.
8. Continuously refine workflows and feedback loops
Your business isn’t static, and your AR processes should always be evolving. Consistently solicit feedback from both your team and customers to identify opportunities for improvement and address pain points effectively.
These eight strategies will not only improve your cash flow but also set the stage for long-term financial agility.
Mark Brousseau, President, Brousseau and Associates
Real client results: The outcomes speak volumes
During the webinar, Bonnie Halvorson, Financial Services Manager at Van Meter, shared how her company revamped their AR processes with Billtrust’s automation solutions. Van Meter, an electrical distributor with over 850 employees, struggled with manual, slow workflows that caused delays and frustration. “10 years ago, we had a team of two working on posting all those payments manually, with checks coming in the mailbox. Almost as manual as it could be. We often ran two weeks behind,” Halvorson recalled.
With Billtrust’s automated cash application, they turned things around significantly, reducing cash posting from weeks to same-day processing. This efficiency allowed staff to focus on higher-value tasks, fostering growth and improving morale.
“Our team now has the tools and resources they need to not only get their work done efficiently but also take time off, volunteer, and grow into new roles," Halvorson shared.
Customers also benefited from Billtrust’s seamless self-service feature, providing instant access to invoices, statements, and payment options. Reflecting on the change, Halvorson emphasized, “It’s crucial that invoices and statements are timely and accurate. For a growing business, there’s no room for errors.”
Her advice to businesses hesitant about automation? “Don’t fear change. Learn what these tools can do for your business and your people.”
Reclaim control of your cashflow
Cash flow is the lifeblood of any business, and it all starts with AR processes. If inefficiencies are holding you back, it's time to take action. By adopting the strategies we've outlined, you'll not only optimize your operations but also empower your team to focus on strategic, high-value tasks.
Want to see how it all works in practice? Take a page from Van Meter’s story and explore how Billtrust can help automate your end-to-end AR lifecycle.
Request a free demo today and take the first step to transforming your AR operations.
FAQ
Common challenges in conventional AR management include long collection periods, manual processes, lack of visibility, and inefficiencies in credit management, invoice presentment, payment processing, cash application, and collections.
AR leaders can improve cash flow management by adopting a holistic approach to AR optimization, breaking down silos, focusing on the customer, and investing in technology to automate and streamline processes.
Optimizing AR processes can reduce costs, accelerate cash flow, and improve customer satisfaction by making it easier for customers to pay and reducing manual, labor-intensive tasks.
Proven strategies to master cash flow include improving remittance data quality, transitioning customers to digital payments, optimizing the customer onboarding process, analyzing and resolving exceptions strategically, fostering collaboration across departments, automating processes with advanced tools, using analytics to identify trends and gaps, and continuously refining workflows and feedback loops.
Automation can help in AR management by eliminating manual tasks, reducing human error, and freeing up the AR team to focus on high-value, strategic activities. It can streamline invoicing, payments, and collections, leading to faster cash flow and improved customer experience.