Electronic invoicing provides convenience, speed, and helps ensure pending payments are cancelled in a timely fashion. However, some companies have been slow to adopt e-billing into their systems. This could be for a variety of reasons. A company might not have a big enough clientele to warrant outsourcing their billing, their clients might prefer paper invoices, and others just aren’t privy to the advantages that e-billing offers. Is outsourcing your e-billing the right move for you?
Reduce accounts receivable
A job isn’t complete until payment has been received. Unfortunately collecting payment is an issue that many businesses can run into, especially if billing is handled manually. Invoices can get lost in the mail, accidentally thrown away, or get looked over. Emailing invoices can decrease the amount of time between invoice date and the paid date by as much as 70%.
With e-billing, the entire process can be automated. This includes generating late notices that are triggered to be sent when a client is “x” number of days late. As a result, clients are consistently reminded that a payment needs to be made and there is electronic proof that attempts to collect were made. Having high accounts receivables not only hurts companies financially, but it can also impact how a company looks to potential investors.
Save on the cost of technology
Billing and accounting software can be pricey. Not only is the initial purchase price high, but the software typically will have to be upgraded every 6-12 months. These costs alone can be a good enough reason to outsource e-billing.
With outsourced services, all of the costs associated with software and upgrades are handled by the servicer which can save companies hundreds or thousands of dollars every year. The amount of money saved in software and time needs to be compared to the cost of the actual service. Most e-billing companies will charge a percentage of the collections received. Savings shouldn’t be the main determinant of whether or not a company will outsource their billing, but it is definitely an important factor.
Kfir Bar-Levav started out as a sales rep in 1995 and since then has acquired extensive entrepreneurship skills and sales experience as a result of working in the field and managing the sales teams of leading international fashion and luxury brands. Kfir founded WRNTY Ltd. in 2006 and today serves as VP of Business Development.