To increase cash flow, automate your invoicing and payment processes

Checking, chasing, and reconciling payments consumes the greatest manual labour and saps the most productive hours of any area of the professional services sector.

It takes reliable processes, cutting-edge automation solutions, and excellent visibility into your customers' payment patterns to provide predictability to your cash flow and payments. The goal is to simplify the entire process. It should be simple to send out accurate bills on schedule. Your customers should find it simple to pay your invoices as they like. Additionally, it should be simple for you to keep track of who has paid and to get a quick, accurate overview of this on a corporate level at any moment.

What therefore are the difficulties and potential remedies for enhancing these procedures?

Using only conventional payment methods

While many businesses modernize every element of their operations, they neglect to do the same for what is probably the most crucial aspect of running a business: being paid. The number of businesses that still use some combination of the following is somewhat astonishing.

Physical checks

While checks have not been used in Europe for more than ten years, they are still utilized in Australia and the UK. Contrarily, in the USA, where almost 50% of all Business to Business (B2B) payments are made, checks are still frequently used. The use of checks in the US is referred to by FT Partners as "the last stronghold of paper-based payments and processes." There are many disadvantages to using paper checks. The money won't be in your account for several days, which increases the possibility of fraud and mistakes made by humans.

Monetary transfers

The bank transfer, the most common and extensively used technique now in use, has a number of advantages over the paper cheque, but it also has its own set of difficulties. Bank transfers result in increased debt amounts and postponed payments since they are a push payment technique, requiring a manual action from the payer. Customers frequently just forget to make payments, or if they have incorrectly designated account beneficiaries, they may make mistakes such entering erroneous account numbers or company names due to human error.

Debit or credit cards

This is the fastest-growing area in the B2B realm, yet until recently, it was rather troublesome. Reconciling payment data with invoices remained a laborious process, and business owners had to do a tonne of paperwork to get set up with a banking institution to permit the acceptance of cards. Many of the barriers have been addressed by the emergence of international suppliers and their integration with project management software, making this the preferred B2B payment method for contemporary, forward-thinking businesses.

The effectiveness of automated billing

The term "professional services automation" has taken the top spot among buzzwords in the consulting, advertising, and knowledge sectors. In essence, it refers to software that links, automates, and streamlines all parts of an organization's operations that provide professional services (PSOs).

You can handle every stage of your project cycle, from pitch to payment, with the help of competent PSA software. Many businesses are now adding the final layer, invoicing payments and recording payments into their systems, on top of the fundamentals of creating a project, allocating people, controlling budgets, and monitoring expenses and time.

How does it function?

You can generate an invoice immediately from quotations, timesheets, or customer orders using software like Scoro, which includes all the necessary information. Scheduled, partial, or recurring bills, as well as automated payment reminders, can all be set up at the desired frequency.

Best practices for invoices to get paid quickly.

The single biggest improvement you can make to speed up payment is to automate your invoicing and payment processes, but there are several additional steps you can take to make this crucial stage of your business cycle more predictable and visible.

1. Clearly state the dates for payments.

Never issue bills with an open-ended due date or a vague expectation of payment. We advise being up forward about your expectations for your payment timeline when discussing any project. While an invoice with a due date that is immediately upon receipt will undoubtedly be paid sooner than one with a due date that is 30 days in the future, avoid catching your customers off guard.

2. Activate the charm.

According to research, bills or payment notifications that include straightforward words like "please" and "thank you" are paid 2% more quickly than those that don't. It is simple to automate this personalization inside Scoro and address them correctly if you know who is verifying the invoice by name.

3. Provide choices to your clients

Multiple payment options result in happier clients. Make sure you fully explain your options, ask them what works for them, and then adjust your automatic invoice templates.

Work 365 is a SaaS billing software and customer self service portal for Microsoft partners to streamline quote to cash process.