As a small business owner, it can be challenging to manage your finances while also juggling other responsibilities. Invoicing and tracking accounts receivable (A/R) can be a time-consuming and stressful process, especially if you are doing it manually. Fortunately, there is a solution that can save you time and money: an A/R dashboard. In this article, we will explore five ways that an A/R dashboard can save your business time and money.
1. Automate Invoice Tracking
One of the most significant advantages of an A/R dashboard is that it can automate invoice tracking. This means that you don't have to spend time manually entering invoice data or tracking payment due dates. Instead, the dashboard can sync with your accounting software, and automatically track all invoices and their payment status. This feature can save you hours of time each week and eliminate the risk of missing a payment due date.
According to a report by Atradius, companies that automate their accounts receivable process can reduce the time spent on collections by up to 75%.
2. Reduce Manual Data Entry
Manual data entry is one of the most tedious and error-prone tasks in accounting. An A/R dashboard can significantly reduce the need for manual data entry by syncing with your accounting software and automatically pulling in data from your invoices. This means that you don't have to spend time copying and pasting data from invoices into your accounting software. Not only does this save you time, but it also reduces the risk of errors and ensures that your financial data is accurate.
A survey by Ardent Partners found that businesses using automated accounts receivable solutions saw a 35% reduction in time spent on manual data entry.
3. Send Automated Payment Reminders
Sending payment reminders can be an uncomfortable task, especially if you have to do it manually. An A/R dashboard can take this task off your plate by automatically sending payment reminders to customers who have outstanding invoices. This not only saves you time but also improves your cash flow by ensuring that payments are made on time.
4. Improve Cash Flow Management
Speaking of cash flow, an A/R dashboard can help you manage your cash flow more effectively. By tracking your invoices and payments in real-time, you can get a clear picture of your cash flow situation at any given moment. This can help you make better decisions about when to pay bills, when to invest in your business, and when to hold off on making purchases.
In a survey by the Credit Research Foundation, 65% of respondents said that improving their AR processes led to an increase in cash flow.
5. Improve Customer Relationships
Finally, an A/R dashboard can help you improve your customer relationships. By automating invoice tracking and sending payment reminders, you can ensure that your customers are paying their invoices on time. This can help you avoid awkward conversations about late payments and maintain positive relationships with your customers.
In conclusion, an A/R dashboard can be an invaluable tool for small business owners who want to save time and money. By automating invoice tracking, reducing manual data entry, sending automated payment reminders, improving cash flow management, and improving customer relationships, an A/R dashboard can help you streamline your accounting processes and focus on what you do best: running your business.
