Cloud solution makes collections easy

Overdue invoices, 90-day payments, managing cash flow – keeping the many sides of an enterprise going is key to running a successful food and beverage business.
Keeping financials in order can be a cumbersome task, especially when chasing down late payments, and trying to keep on top of a company’s own outgoings.
Eric Maisonhaute is the director of accounts receivable solutions at Esker Australia, a company that offers cloud solutions to digitise and automate order-to-cash and procure-to-pay processes. He is well aware of the pitfalls and strains that can be put on companies as they try to keep ahead of the game when it comes to balancing the books.
Esker’s portfolio of Cloud accounts receivable solutions can streamline processes to make collections easy to understand and complete. What sort of features does it offer?
“There is a solution that automates the delivery of customer invoices, proof of delivery and so on,” said Maisonhaute. “It automates the delivery of documents out of any ERP system in any format via any channel. This includes the printing of invoices to be delivered via postal mail, thanks to our local printing facility. It can also format a document according to the preferred mode of reception by the end customer i.e. paper, fax, email, e-invoicing, EDI, etc.
“Of course, delivering invoices is critical. Typically invoices need to be processed by the end customer. Esker can assist with this process with its Accounts Payable automation solution. This is followed by the payment process by the customer. On the supplier side, then both cash collection and cash reconciliation are critical. It would make the process straight forward and effective if not for discounts, disputes, and claims. That is why Esker proposes different solutions to address the various aspects of the AR process.”
In terms of the collections process, Esker offers a comprehensive collections management solution. It assists all steps of the collections process and automates the sending accounts statements or statement reminders.
“You can easily segment your customers and have different collections strategies for different groups of customers” said Maisonhaute. “We know you have your good, timely payers, but you might also have slow payers, bad payers and so on. You might want to adopt different collection strategies.
“With this solution you can set up your own rules such as when payment reminders will be emailed to customers with overdue invoices.
Based on these rules, the solution creates a personalised to-do list for each AR officer or collector. So, every day, collectors can focus their activities on engaging with customers and discuss payment issues, reasons for late or overdue payments, negotiate payment plans, etc.
This automation has saved two to three hours per week for the AR team at one of Esker’s customers, Australia’s largest crane hire company based in WA.
“What they love is that they now get all the replies from customers centralised in one place and do not have to set reminders in calendar, it now automatically pops up in their to-do list,” said Maisonhaute.
“The solution also includes internal collaboration tools to create tasks and internally collaborate with other departments. For instance, a customer might request a proof of delivery docket or claim a discount. This means it is speeding up the process of answering and helping customers and, like for our customer Temperature Equipment Corp., resolve dispute 88 per cent faster.”
The solution includes a self-service capability. This allows a company’s customers to interact with the same solution in a self-service mode. As the customer receives its accounts statement, or a payment reminder, the accounts payable officer can click on a link in the email that takes her/him to the customer portal. This enables customers to become self-sufficient, because they can go and access their invoices, download their statements online as a pdf, and can query any issues with an invoice.
“They have access to all of their invoices and accounts statements online,” said Maisonhaute. “They can then select the invoices and pay online and they can also organise a payment by credit card or bank transfer. This is helping companies collect their cash in different ways and helping your customers pay quicker by offering online payment capabilities. LinPepCo, a Pepsi-Cola franchisee, managed to get 69 per cent of its customers on AutoPay with our solution, where invoices are automatically paid on the due date.”
“For customers who continue to pay you directly from their bank account, their Enterprise Resource Planning (ERP) triggers the process of EFT transfer and so on,” he said. “This is where our Cash Application Solution helps with the reconciliation of those payments. You have the payments coming into your bank account, so we ingest the bank statement first to understand what payments you have received.”
On the other hand, you might have received a remittance advice, so the solution can process it by extracting the data out of the document.
“Usually we have your list of open invoices and credits. Between those three documents – the bank statement, the remittance advice and the open invoices and credits – Esker’s AI logic automatically determines which invoices have been paid, and in what amounts,” said Maisonhaute. “This removes the manual tasks of allocating payments in the ERP. It clearly automates the cash allocation process and your team can focus on exceptions.”
Maisonhaute said the solution is intuitive and provides dashboards. There are several dashboards that provide real time information about the status of customers, divisions or companies, ageing balances, KPIs such as DSO and CEI. These metrics are essential to measure the efficiency of the collections process and the productivity of the collectors.
This helped our customer Wine Warehouse set goals and track easily how they were able to raise the CEI to 80 per cent and increase the amount of money collected by 45 per cent over a single year.
“When you log into our collections management solution you access a dashboard with your to-do list for the day – what calls you have to make, etc,” he said. “Maybe your credit manager decided that, for example, you have to follow the 90-plus day invoices, or invoices that are closed or are critical in terms of receiving a payment. That’ll be organised in the to-do list. You don’t have to waste time prioritising and deciding what they have to do, which is typically the case when you don’t have an automation solution.”
Setting up the solution only takes a few weeks. Esker consultants work with the AR team throughout the process. And once it is up and running, the time savings and ease of use will be noticeable to a company’s bottom line, according to Maisonhaute. Job satisfaction in the AR team also increases as most tedious tasks have been automated.
“We typically start with a kick-off with the team setting up the project and a time line of the tasks,” he said. “Then we run the implementation activities. It is important to note that at the beginning the IT team needs to be involved for the data integration with the ERP. Then the business teams and the operations teams are involved to validate the configurations. Then there is a testing phase, and end user training, and finally the planning for the switch to production and going live.”
Esker proposes a simple subscription pricing model for its solutions. For Collections Management the subscription fee is based on the number of transactions and invoices. For the Cash Application the subscription fee is based on the number of payments. Esker also takes the security of its clients very seriously.
“Also, back-up service is included,” he said. “All our solutions are in the cloud. Every year, Esker needs to renew its various certifications. We have large customers in various industries running our cloud solutions. We have a chief of security and of data privacy – we take it very seriously.”
The subscription fee also includes technical support and it comes with a customer experience program.
“We have a program called First Year @ Esker. This program is like a personal fitness coach for your AR processes and AR teams. From the time our customers go live, we follow them and have regular interactions with them with calls and ad-hoc training sessions throughout the year to make sure users can fully exploit the capability of the solution and that the company achieves the highest ROI,” said Maisonhaute. “We coach end users and provide best practices to drive a long lasting and effective process change. We want the user experience with our solution to be fantastic, and that is why we have such a high level of satisfaction from end users and a very high level of retention of customers.”

Collections efficiency increased due to cloud-based solution

Operating in the self-proclaimed “happiest place on Earth”, the Wine Warehouse distributes fine wine, beer and spirits to companies located throughout California.

The company’s customer base often orders more than once a week, resulting in roughly 15,000 weekly open invoices to collect on.

A challenge to handle that number of invoices in any environment, the matter was further complicated by some sales representatives having to collect payment by hand while on site. Although a common process in Wine Warehouse’s industry, this process led to an increase in Days Sales Outstanding (DSO) and often left sales attempting to reconcile accounts and handle issues better suited for the accounts receivable (AR) department to handle.

Now, the process is more efficient thanks to Esker’s Collections Management solution. Rather than relying on sales to handle invoice questions and receive payment, invoicing and collections are now left to the AR department – resulting in faster collections and a higher level of visibility due to custom reporting tools and real-time metrics being tracked.

On the other end, customers can access a self-service portal. From this portal they may view invoices, setup an auto-pay option or immediately pay, which in turn reduce DSO and improves the customer experience. Not only does the cloud-based solution offer staff newfound capabilities – such as taking payments over the phone or monitoring best possible DSO – it has benefitted multiple teams by centralising all AR information.

“The enthusiasm for Esker isn’t just limited to the AR department,” said Patrick Powers, credit manager at Wine Warehouse. “Our IT team was the one that introduced it to us and recognised its potential. We all love it.”

Since implementing Esker’s automation solution, the Wine Warehouse has managed to streamline its systems, which has led to:
• Increased amount of money collected through solution by 45 per cent over a single year.
• Raised the Collections Effectiveness Index (CEI) to over 80 per cent.
• Greater staff productivity; sales are no longer involved in invoicing and there are less customer calls requesting paper copies.
• Enhanced visibility; customisable reports and real-time Key Performance Indicators (KPIs) are easily accessible.
• Customers have self-service options and are able to communicate directly with accounting rather than sales.
• Lowered DSO; sending weekly automated reminders to customers.