5 Tips for Managing Invoiced Receivables

Accounts receivables can be one of the more overwhelming business challenges for any sized business or organization.  If mismanaged, overlooked invoices, late payments, and inability to collect will greatly reduce working capital. Therefore, invoiced receivables are often the first place to look to improve cash flow. The following tips will ensure proper management of accounts receivables so that your business will continue to build and grow.

1. Use Invoicing Software

   Quickbooks or online money management programs like Freshbooks are great ways to stay organized and keep the invoicing process running smoothly. This software helps to keep track of receivables by offering reports on how many invoices have been sent, what’s been viewed by clients, paid invoices, and how much is still outstanding. Software that automates accounts receivables will also help portray a professional image through customizations to terms, payment detail, and branding. Invoicing software also keeps the collection process organized and documented.

2. Set Clear and Reasonable Payment Terms

   Many businesses demand payment “upon receipt” or “immediately.” While this practice is effective in communicating the urgency of payment expectations, it does not always guarantee fast bill payment. The wording on the invoice can influence customers to pay as agreed. Consider more specific payment terms such as 21 days or by a specific date. More importantly, once you’ve established your payment terms, stay consistent with the timeframe to maintain client trust and ensure a steady cash flow for your business.

3. Know Your Business Finances

   Even if you do hire a professional accountant or bookkeeper to help manage your financial records, it’s important for you to remain informed regarding open accounts, timeliness of payment, and what’s being done to collect overdue invoices. Staying aware of the receivables process will help you manage your working capital and stay in control of your business.

4. Establish a Method of Collections

   When clients fail to pay on time, an established process for collections will guarantee a smooth and pleasant experience for your customer. Set a clear schedule of communication such as a call once the payment deadline passes, a follow-up e-mail within a week, and then another call at 30 days. When making collection calls, be sure to comply with the Fair Debt Collection Practices Act. Another option is to enlist outside help from a collection officer or credit manager who can help you navigate the collection process.

5. Accounts Receivable Financing

   This can take the form of selling the companies receivables for immediate cash (factoring). If you decided to factor your receivables with a company like FACTOR KING®, you can benefit from services like accounts receivables management, credit services, reporting, and professional collections.

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How FACTOR KING® Can Help
FACTOR KING® is a direct financial service provider that specializes in the Factoring of invoice receivables. We offer an ongoing accounts receivable funding facility that guarantees your ability to raise cash on a moments notice.

• Accounts Receivable Department: We become your accounts receivable department, providing detailed financial data on all open and closed receivables 24 hours a day 7 days a week.
• Credit Department: We will work with you to establish acceptable credit limits for your customers, performing instantaneous underwriting reports to help you make the right decisions quickly and efficiently.
• Reporting: FACTOR KING® functions as your record-keeping department, providing you with aging receivables reports, payment records, hourly status reports and other reporting.
• Collections: We provide professional collections on all open receivables. Our trained collection specialists recognize that they are dealing with your most valuable asset - your customer.

If you need help managing your accounts receivables and are looking for a way to cash flow your business with immediate working capital, apply now for FACTOR KING® accounts receivable financing.  Most accounts are established within 72 hours for immediate payments!