Best Practices

Best practices involve implementing best-of-breed processes and procedures in order to make accounts receivable department of our clients more effective. Many companies that have benchmarked the accounts receivable process have adopted the following best practices:

Using the credit and collections process to enhance customer satisfaction. Some world-class organizations actually send their credit personnel with their sales representative to explain credit terms to a client right at the inception of the business relation.
Continuously update customers' credit ratings using a behavioral scoring system. Monitor customer payment behavior, usage activity and total customer exposure versus assigned credit lines by integrating technology. Dun & Bradstreet offers an on-line, credit scoring program that allows a company to track key performance indicators and improve the management of its credit function.
Electronically receive and post customer payments to the billing system in real time. This reduces processing costs and expedites cash flow.
Move to automatic invoicing and adjustments posting.
Develop invoice numbering schemes that are unique to each division and reducing the number of banks and lockboxes a company uses. Since that means a company likely will be receiving several remittances from different customers in the same lockbox, unique invoice numbers are needed in order for the system to properly apply the cash. This also serves to reduce banking costs.
Create a single point of contact for all incoming customer calls regarding payment and use technology to route the calls to the appropriate service representative or automated activities. Establishment of a 1-800 telephone number is a low-cost but effective solution that provides such single point of contact.





Best practices involve implementing best-of-breed processes and procedures in order to make accounts receivable department of our clients more effective. Many companies that have benchmarked the accounts receivable process have adopted the following best practices: Using the credit and collections process to enhance customer satisfaction. Some world-class organizations actually send their credit personnel with their sales representative to explain credit terms to a client right at the inception of the business relation. Continuously update customers' credit ratings using a behavioral scoring system. Monitor customer payment behavior, usage activity and total customer exposure versus assigned credit lines by integrating technology. Dun & Bradstreet offers an on-line, credit scoring program that allows a company to track key performance indicators and improve the management of its credit function. Electronically receive and post customer payments to the billing system in real time. This reduces processing costs and expedites cash flow. Move to automatic invoicing and adjustments posting. Develop invoice numbering schemes that are unique to each division and reducing the number of banks and lockboxes a company uses. Since that means a company likely will be receiving several remittances from different customers in the same lockbox, unique invoice numbers are needed in order for the system to properly apply the cash. This also serves to reduce banking costs. Create a single point of contact for all incoming customer calls regarding payment and use technology to route the calls to the appropriate service representative or automated activities. Establishment of a 1-800 telephone number is a low-cost but effective solution that provides such single point of contact.