If you have your own business, no matter what it is you do – whether you have your own app development agency or you are a corporate communications advisor or you have a business by which you say help entrepreneurs getting the most out of their social media: every entrepreneur knows that running a business can be a rollercoaster ride. You go from landing a major new contract to losing a key employee to partnering up with a new firm that boosts your sales again. And then you work toward another high and from this high you land into another low. These highs and lows are part of the job, part of what it means to be an entrepreneur.
One thing probably every entrepreneur – no matter if you have a big or a smaller business – recognizes is that money is always a potential source of problems. Money is also very important. You need it to be able to carry out your plans. But money issues can also be a drain on your time and your energy. If money issues get out of hand, it can mean you can’t pay your suppliers on time. They may then impose late payment fees on you. Or worse, in the future they may not want to do business with you any more unless if you say pay beforehand.
Even worse is when is when you can’t carry out plans because customers of yours haven’t paid on time. You have to for example dial back marketing plans. This may mean you miss out on potential revenue as a result, which may reduce your potential for growth… or worse, it can put you into a vicious cycle.
It’s fair to say that for many entrepreneurs accounts receivable are a thorn in the side. This term – accounts receivable – of course is a mouthful. Simply put, this is what it means: how do you get people who owe you money to pay you. That’s what it’s about. The frustrating experience of having someone not pay and the process by which you get them to pay after all.
As an entrepreneur, every once in a while, you will encounter customers who don’t pay on time. It’s inevitable. It’s not just about money. It’s about what you could have done with that money. And it’s about time. It’s about being distracted from things that are even more important. It gets you out of your flow: it disrupts your business rhythm. It is often stressful, cause its reverberations cause stress in its own right. What if you are organizing say an event and then you had all these amazing plans worked out to hand out merchandise and then at the last moment it turns out you need to dial down your plan cause your long time customer is not paying any more all of a sudden.
You sent your invoices. Even the first polite reminders you sent out. And yet, no payment is in sight. And it’s frustrating. You are chasing what’s rightfully yours. You worked for this. It’s their responsibility now to pay you. You met your deadlines. And they are not meeting their deadlines toward you. These feelings can drain your energy. And it can distract from your focus on growth and innovation. The worst part is that simply hoping for things to improve on their own rarely works. Sometimes there is a client who simply forgot or who got too busy. But even then it takes sending out yet another reminder or giving them a call (or sending out that Whatsapp message, cause it feels just a tad bit less uncomfortable than picking up the phone does).
Accounts receivable management services
In these situations you soon come to realise that professional help is indispensable. This is where accounts receivable management services come into play.
Up to a certain degree there are things that you can do yourself. If you have a small business with only a few customers, you can probably keep track of things in an Excel or a Google Sheet for a while. You can download some template off of the internet and just fill out the fields in the right way so you send out invoices and then payment reminders and the whole chebang. But even then: what do you do when a customer persists in not paying? You will have to get a lawyer involved. Or you can get an accounts receivable management services agency involved.
Atradius’ Credit-IQ
The bigger the business, the more complex these things become of course. As a small entrepreneur you can often just keep an overview of things using a spreadsheet. The larger your business, the better the software you will need. There are software products that help you avoid chores like sending out payment reminders. Atradius’ Credit-IQ is a good example of this. There are also other packages like Invoiced and BILL, but these tend to be bigger packages that carry a price tag that matches the larger number of features. I think many entrepreneurs don’t need all these features. Credit-IQ was just fine for me.
Accounts receivable management services for when accounts receivable management software doesn’t suffice
When it comes down to the most stubborn of arrears, just a bit of software may not be enough. This is the part where accounts receivable services come in. There are many ways to go about this, but typically when people use the term accounts receivable management services, they mean the outsourcing of their accounts receivable management to an agency. And then there are of course many agencies to choose from. There are small firms (some of them so small they consist of only one person, mind you) and at the other side of the scale you find multinational accounts receivable management service agencies like Atradius Collections.
The things that agencies can do for you involve everything from issuing invoices and sending reminders to taking more formal (and that includes legal) steps to recover debts. A good agency like Atradius Collections knows how to go about this in a sensitive manner, showing understanding to the debtor, while also being sufficiently assertive. These are skills that people have developed over time and as an entrepreneur you may not be able to do it quite as well by yourself as someone who has been doing this for many years may be able to. Outsourcing to a dedicated accounts receivable management service can provide more than just relief to you. It can help you regaining control over things, including your finances. And the peace of mind it may afford you may help you focus. And this focus may be worthwhile in its own right, both in financial and in practical terms.
There are many different types of accounts receivable management service agencies. Some of them focus on Business to Consumer (B2C) matters, others focus on B2B (business to business) matters. An example of a large and renowned agency that can help you with B2B is Atradius Collections. Another important distinction to make is whether you are dealing with a domestic or an international case. The reason being: cases that cross borders tend to be more complicated in nature. When you are dealing with a complex, cross-border case you want to make sure you get a large, multinational and experienced agency like Atradius Collections involved. Your local SMB agency likely does not have the competences that larger agencies like Atradius Collections have. For example, smaller agencies oftentime do not speak the debtor’s language. Also, they may not have experience with legal proceedings in other countries, the way agencies like Atradius Collections do.
So in case you have a client who suddenly becomes unresponsive, you may want to get an accounts receivable management service agency involved. Rather than doing it by yourself or to have an employee of yours do it. The stress of the unpaid invoice may weigh more heavily on you than the money it may help bring in may be worth to you.
In summary: accounts receivable management services
Overall, it is to be recommended to entrepreneurs of business large and small to consider taking out professional accounts receivable management services. The relief that comes from knowing that there are people who do this kind of stuff for a living who take these cases over from you, can offer much needed relief. You may want to choose an experienced agency like Atradius Collections. And especially when dealing with cross-border cases, multinational accounts receivable management service agencies like Atradius Collections can offer better services that better suit what your accounts receivable management service case requires than smaller agencies do.
