Mathias Eleaume

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Small business owners: 3 good reasons to digitalize your cash collection in 2021

The Covid-19 crisis has caused payment delays to skyrocket, and SMEs are the most affected. In 2020, the barometer of payment delays records a delay of 18.6 days – against 10.9 the year before the crisis in France. 95% of the SME owners surveyed are aware that failure to meet payment deadlines puts the company in danger and that this is responsible for the bankruptcy of 1 in 4 SMEs.

However, for many companies, failure to pay on time is not due to a lack of cash but to a policy of cash preservation. Because their activity is not impacted by the crisis, or because they have used the support measures offered by the government, these companies have the capacity to pay but refuse to do so, preferring to build up reserves. Your debtors probably have the means to pay you, but you may have to encourage them to do so.

Rather than resorting to credit to finance your cash flow, get the money from your customers by reducing your payment terms. To do this, you need to strengthen your collection processes. This strategy is less costly than credit and does not require additional human resources: rely on automated, agile, secure and efficient digital solutions. Let’s zoom in on 3 good reasons to digitalize your debtor management in 2021.

 

1. A digital tool to anticipate customer risk

The crisis has largely redistributed the cards: a customer who was once solvent may now be in serious financial difficulty. Assessing customer risk, in 2021, means:

  • The possibility of adapting your dunning scenarios to increase your chances of getting paid on time by the riskiest customer profiles.

  • The ability to arbitrate on whether to continue the business relationship. When a customer’s situation is particularly critical, you can choose no longer do business with them.

A powerful debt collection software should have the following features to anticipate customer risk:

  1. The tool analyses the payment behavior of each customer. Depending on the number and recurrence of late payments, if any, the customer is attributed a payer profile. Make sure that your tool offers a scoring functionality.

  2. On your dashboard, you can immediately see which customers are at risk. From then on, you can adapt your communication within the framework of the reminder. Make sure that the tool offers customization and automation of scenarios, to save time in your collection – while maintaining good business relationships.

  3. Visibility into your outstanding receivables allows you to measure customer risk in a comprehensive way. You can anticipate collections for optimal cash management. Make sure you choose an intuitive digital solution with a clear and comprehensive dashboard.

 

2. Digitizing for remote collaboration

A SaaS tool is essential in the age of telework. The confinements have forced you to set up partial or even full remote presence. In these conditions, your teams are no longer able to exchange data physically in your office. Remotely, communication and collaboration become more complex.

To avoid disorganization and errors in the implementation of your collection processes, opt for a collaborative solution of the SaaS type. This way:

  • Documents can be accessed in the cloud from any location and from any device.

  • Data is updated in real time.

  • Your employees communicate constructively.

  • You keep in touch with your employees, to reinforce the cash culture.

By preserving the perfect continuity of your collection service, you ensure that your collections are always efficient.

 

3. Digitization of collection to increase efficiency

The digital debt collection platform optimizes the organization of tasks. Via the dashboard, each employee knows exactly what he or she has to do every day. The tool keeps the status of the reminder up to date for each customer, leaving it up to the employee concerned to take the necessary action.

Thanks to the scoring, personalization and automation functions, your team grows:

  • The dunning scenarios are automated, allowing you to dun 100% of your customers: no invoice is neglected, you considerably reduce your payment delays.

  • Prevention, reminder and thanks: your digital solution integrates all the steps of an efficient collection. Your processes are structured and your brand image is enhanced.

  • The digital collection tool includes multi-channel reminders: by email, by telephone, by mail… the means of communication are personalized for each customer, to increase the efficiency of the collection. 

As a partner of small and medium-sized businesses, especially in times of crisis, Clearnox assists you in the digitalization of your collection processes. With Clearnox collection software, you can manage your outstanding receivables efficiently, without wasting time.

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