Accounts Receivable Mistakes Not to Make

When it comes to accounts receivable, proper management is the key to success. When this aspect of your business is handled correctly, you will not only get paid, but you will also get paid on time. However, receivables do require diligence and attention, and letting them go and not putting the proper effort into them is a mistake. There are several common errors that people make with receivables, and taking the time to read about them will help you avoid them in the future.

One accounts receivable mistake that people tend to make is failing to prioritize. When your receivables are not the number one, chances are that they are not working out like they should. When your business is owed money, it is crucial to have that at the top of your list. You must somehow make time for the invoices, and doing so will help to decrease late payments.

When communication is unorganized, your success can go down. You must constantly keep records of communication and what has been done regarding a customer. A receivables management system can prove to be of great assistance in this situation.

Another accounts receivable flaw that often occurs is that a business will only accept checks. Online payments will help to do away with lost checks and customers forgetting. Not only are you lowering your chances of getting paid on time, but you are also increasing the likelihood of payments not being kept track of or getting misplaced. When customers have the option to pay online with their card or with ACH payments, they are more likely to pay instantly. They may additionally set up a payment plan if they are currently low on money.

When a business does not follow up on an invoice within a certain amount of time, it will become more difficult to get paid. Stop losing money and begin collecting within days before you or the customer forgets.

Not calling your customers who owe you money is another fault of many business owners. Calling is much more effective than sending letters, as mail usually gets pushed aside. A call will help late customers to see how serious it is that you get paid on time, making their payment a priority.

Finally, another accounts receivable mistake is just letting things go. If you keep allowing customers to make late payments or not pay at all, they will only continue to do so and take advantage of you. When there are consequences for late payments like late fees, customers will be more motivated to pay you on time. 

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