Finance leaders responded to the pandemic by accelerating digital investment, helping them better manage their work, workforces and working capital.
The impact of the pandemic on finance teams has been well documented. From challenges forecasting cash collections to customers delaying payments, CFOs had their work cut out. Not to mention the significant operational changes that had to be made when people began working from home.
Businesses responded by accelerating their digital investment. In accounts receivable (AR), 83% of firms have changed their processes since COVID-19 hit and 70% plan to automate. This is unsurprising when you learn that manual AR processes can slow payments collection by as much as 67%.
We examined the challenges faced by three leaders and the successful steps they took to transform their AR performance during the global crisis.
PETER ROLLER, DIRECTOR OF AR, LOGMEIN
Peter Roller needed to scale operations to manage a 26% increase in electronic invoicing caused by the pandemic.
“We were looking for a new partner who not only had a tight integration with NetSuite but with who we could establish a true partnership.”
LogMeIn was using an outdated AR tool and the team did not know who to contact with questions on it. Peter wanted a solution that would not only improve AR management, but come with an experienced team who could guide LogMeIn on how best to use it to manage new challenges.
LogMeIn needed an accounts receivable solution that would help manage a 26% invoice increase
By integrating YayPay with the company’s NetSuite ERP and tech stack, LogMeIn was able to centralize AR data. Cloud-based dashboards displayed this information in real-time and teams could access the platform from anywhere. Automated capabilities improved collections effectiveness by sending engaging, tailored emails to customers on a consistent basis. This enabled the team to manage the 26% invoice increase without adding headcount.
“We were able to scale rapidly when the unexpected hit. And we did so without increasing our operational expenses and while still hitting all our KPIs.”
The YayPay team onboarded LogMeIn to new product features and advised the team on how to optimize their use of the technology. LogMeIn reduced DSO by ½ day, despite the dramatic invoice increase, and the company’s cash forecast continues to beat every previous month.
Full story here.
HARRIS HWANG, CFO, WATERMARK INSIGHTS
Effective liquidity management was the key priority for Harris Hwang during the pandemic. Harris was focused on not just maintaining business continuity, but also having capital available to invest in growing the business.
During the global crisis, managing liquidity and freeing up working capital was critical for Watermark
This was difficult to achieve with the company’s AR setup. Measuring cash flow and forecasting accurately was a challenge as AR data was spread across disparate systems. This made it hard to consolidate and analyze effectively.
“Our business is cyclical. This means forecasting our peaks and troughs is critical to managing consistent business health.”
When the pandemic struck, customers began deferring payments. The AR team had no effective way to prioritize collections efforts and their process was manual and inefficient. In addition, about 30% of the company’s collections were still based on paper checks and these were difficult to manage remotely.
YayPay’s intuitive dashboards and predictive analytics enabled Watermark’s AR team to more effectively manage their customer portfolio. This helped prioritize tasks and customers to follow up with.
“YayPay gave us more predictable forecasting, allowing us to understand cash flow from a bottom-up perspective. Now we could see what the payment trends were and manage our business accordingly.”
Automated collections helped the company quickly transition customers to electronic invoicing. Consistent communications powered an effective follow-up process which engaged customers and increased payment speed.
Using YayPay, Watermark increased collections, hitting their highest number to date in October. Customers seeking delayed payment terms decreased to a negligible amount and the company’s AR aging profile improved significantly.
Full story here.
5 WAYS YAYPAY'S AR AUTOMATION TRANSFORM YOUR BUSINESS
|1||Automation improves team productivity by 3X and make collections 34% faster|
|2||Cloud-based dashboards enable your team to access AR data from anywhere|
|3||Predictive analytics power 94% forecasting accuracy and predict payor behavior|
|4||A complete communications history records all customer interactions so you stay in control|
|5||Customers pay via a secure, self-service portal in the way that they want|
EBEN PAUL, CFO, MAMMOTH CARBON
Eben Paul was faced with a 20% invoice increase when the pandemic began. The company was unable to manage this spike, as its collections process was manual and reporting was managed using Excel. This limited visibility into customer accounts and caused invoices to become delinquent.
Mammoth Carbon needed to move away from manual accounts receivable processes to overcome challenges
The company partnered with YayPay to address these challenges. YayPay automated collections, making them consistent. AR data was centralized on insightful dashboards which the AR team could access from anywhere. This was pivotal in the transition to remote work.
“YayPay instantly enables my team to see our customers’ days payable metrics. This has been invaluable in providing insight into our cash flow, helping us anticipate challenges and make informed decisions when increasing credit limits.”
The result? Days sales outstanding (DSO) decreased by 10 days, despite invoices reaching a record high. This reduced working capital needs by at least US$1 million, improving the company’s operating efficiency and increasing its availability of funds.
Full story here.
Transform your AR today, contact the YayPay team now.