For small to mid-sized companies, keeping a tight grip on your receivables management is very difficult. There are many factors that impact how the invoice comes to be and with limited resources, managing them can be challenging task. However, there are a few tips that you can use combined with factoring that will create excellent receivables results.

The proceeding operations that most commonly impact actual receivables include the quote, contract and pricing, order processing, credit control and invoicing. These proceeding factors are critical to the management of your receivables as an asset. These functions directly impact the quality and collectibles of the asset and are the driver of the cost to manage your revenue stream. Put simply, customer satisfaction and accurate invoicing create excellent receivables results.

This holds true even if credit control or collections are not as strong as they should be. The point being, superior order fulfillment equals high customer satisfaction. With accurate invoicing your cost of concessions and delinquency can be greatly reduced. And when competent credit control and collections are added you can maximize your receivables management effort.

What does this mean for you? By polishing your quote, contract and pricing and order processing procedures and using Universal Funding’s factoring services to manage your credit control and collections and you can dramatically decrease if not eliminate all concessions and delinquencies in your accounts receivables.

Tips to creating excellent receivables results:

Quote:

• Never quote something you can not deliver. Whatever you are selling you need to know that you can deliver what you promise.

• Make sure your quote includes:
  
• The unit amount, total price, sales tax, discounts and applicable late fees
  
• Freight cost, actual versus allowance, who pays for it
  
• Payment terms, when the payment is due
  
• Timing the issuing of the invoice, i.e. upon shipment, completion, etc.
  
• Description of the product/service offered

Contract:

• Make sure that your contracts are clear and that both parties agree to the terms.

• Create a clause that automatically renews the contract unless otherwise stated so that they do not expire.

• Create a system tool to track your contract start and expiration dates that will notify you and your client for updates. If prices change they will be revised at the time of the contract renewal.

Pricing:

• Always dot your I’s and cross your T’s! Price discrepancies are the number one cause of invoice disputes. It never hurts to double check your work. Make sure that the price you discussed and are offering is signed off on and accurate!

• Keep your pricing simple.

• Give all your products/services product numbers and a price associated to that number.

• Communicate price changes clearly and in advance so that all your contracts and price schedules are updated.

• Investigate pricing errors and or discrepancies and resolve them quickly.

Order Processing:

• To be a valid order, the invoice must have a valid purchase order number.

• It must also, as stated earlier, have a clear description of the product/service, payment terms, freight terms, delivery date, price and quantity.

• Follow-up – half way between the time of the order and delivery, follow-up with your client should be made regarding the order specifications and payment terms.

• And remember - accuracy is the most important aspect of invoicing, make sure the invoice content is easy to follow and clear and concise.

 All of these processes will dramatically decrease concessions and delinquencies and if mixed with the following factoring services will dramatically improve your companies revenue.

Universal Funding provides Factoring as well as Credit Control and Collections:

• If you offer credit terms to your customers, you know how important it is to know their credit history and what amount you feel comfortable extending to them.

  • Utilize Universal Funding’s credit control and collections services

    • Universal funding will check the credit of new and existing clients so that you can streamline credit approvals and limits.

    • Universal Funding will help you review and establish metrics for determining credit approvals and limits helping improve your decision making on new business.

    • By using Universal Funding to manage your credit control you can save money from the reduction of administrative costs.

    • Part of the service you will receive by factoring your invoices is efficient credit assessment and collections.

    • Upon delivery Universal will follow up with your accounts immediately determining if there are any problems with the initial agreement of delivery. By using an outside source to ensure payment is made, invoice disputes are immediately addressed and delinquency is greatly minimized.

 If you are interested in learning how factoring your invoices as well taking advantage of our credit control and collections can help your company, please call 1-800-901-2418 to speak with a factoring specialist today.