Common problems experienced in the Collections Department
Management seldom have time to devote solely to debtors, and often rely on
reports from staff showing only the amounts
outstanding and the expected payment estimates.
Looking at the Age Analysis will show clearly the amounts outstanding, but
not the reasons why the amounts are outstanding,
nor will it show you the expected amounts to be collected.
Collectors will try to track payment progress and the reasons for late or
non-payment, but will often write down cryptic clues
on pieces of paper which only they can interpret. If they are recording the
information on a spreadsheet, they may save that
spreadsheet in a place that is only known to themselves. This all results in no
central place for management to extract the
reasons behind the late payments, and having to rely on their collectors to
share the information when requested.
Tracking debtors trends to establish what the common reasons are for late
payment becomes difficult, and cashflow planning
is then based on instinct rather than fact.
Knowing the reasons for late or non-payment is important, as is keeping
abreast of the agreed outcome and ensuring that
arranged terms are adhered to. If a debtor is permitted to delay payment
repeatedly, it becomes increasingly difficult to collect
the amounts due.
Collectors may not have an adequate manual system of their own, and can lose
track of when a debtor promised to pay, or
what actions they needed to take in order to collect the money, making it
difficult for management to generate cashflow
forecasts.
Cash Manager can help businesses overcome these problems
Cash Manager provides businesses with a tool to introduce or improve debt
collection processes. It will provide you with
reports which illustrate what action staff are taking to collect outstanding
debts.
Because Cash Manager will turn your debtors department into a communication
centre, you will be able to see how many
calls the collectors have made, and what the outcomes of those calls have been.
In addition to this, you will also have insight
into the content of those calls.
The collector will record the reasons for late or non-payment, the actions to
be taken, and detail the due dates or action dates
for follow-up. Daily reports will show collectors what they still need to do in
order to collect the funds in cases where debtors
have missed their promise to pay dates, as well as the content of previous
conversations.
Collectors will select the promise to pay dates and the amounts expected on
those dates. Based on this simple information,
a cashflow forecast will become instantly available. Management will be able to
get an accurate picture of exactly how much
money is coming in at any given time, and if a target has been missed, the
reasons for that can be easily identified.
Cash Manager will change the behaviour of collectors, debtors and
possibly even management
Collectors will be able to confidently provide debtors with accurate
reconciliations, contact reports, as well as a list of outstanding
invoices immediately, and not have to first compile a specific report for each
debtor. The visibility that management will have
into collectors’ productivity encourages healthy competition to get outstanding
debts settled as quickly as possible.
Your debtors will become aware of your professional management and communication
systems, your expert reports will assist
both them and you in managing the debt, and they will never be able to take
advantage of bad communication.
Managements’ increased insight into the efficiency of the department will allow
them to alter business processes for more
seamless outputs. A competent debtors department will be able to quickly
establish common trends for non-payment, and
management will have the ability to make informed decisions.
How does Pastel Cash Manager work?
Quite simply, Pastel Cash Manager pulls through the Age Analysis from Pastel
Accounting. Your collectors will work from the
Age Analysis and record information in just two places.
By clicking on the amount in the aged period, the collector will see all
invoices that make up the balance. Per invoice, or per
aged amount, the collector then records the information such as:
The Promise to Pay date.
The Reason Code for the customer not paying (These reason
codes are customisable. Reasons such as, POD Requested, Cash Flow Problems,
Price Dispute and more
have already been created, but unlimited Reason Codes can be added.)
• Expected Amount to be collected.
• Action still to be taken.
(Actions are also completely customisable although Actions such as Call
Customer Again, Copy Invoice Requested and
more have already been created for you.)
Users can mark the amount if the required Action has taken
place.
They can mark the amount if they need to do a Call Back and
then specify a Call Back date.
The only other place they need to work in is the Contact
area, where they can store the details of the conversation or
contact with the debtor.
From only two areas of simple input, Pastel Cash Manager is then able to
provide you with all the reports, such as the Contact
report, Promise to Pay Fresh and Promise to Pay Stale reports, Call Back
Reports, Reason Code Summaries, Action lists,
Cashflow Forecasts and more.
Collectors will run daily reports such as the Call Back Reports, Action Lists
and Promise to Pay Stale reports, which will
provide them with all the necessary information to ensure that they have a birds
eye view of their required actions.
As the collectors are recording each contact with the customer in real time,
management can run any of the reports at any
time to track progress, and analyse the Cashflow Forecast.
Key Benefits Summarised
Visibility
Management
Instead of looking at the 30, 60 or 90 days amounts on the Age Analysis, you
can now see the reasons behind why
the money is outstanding, which increases your awareness into the debtors
book.
Debtors
Reconciliations are instantly available and easily emailed to debtors,
providing more security for you and for your debtor.
Reduce the risk of write-offs
As you are able to track trends for non-payment such as service level
issues, action can be taken to correct the situation
in order to collect the moneys due.
All outstanding money can be properly tracked, so the risk of overlooking a
debtor for extended period is vastly reduced.
Write-offs can be eradicated as the debts will be collected before they
become stale.
Introduces a collection methodology
Business processes can be introduced and monitored, to see if they are being
followed.
Because of the visibility, management can gauge what is or is not working
and improve processes.
Cashflow Forecasts
Management can set targets for collections, and monitor the collections
against those targets.
The Cashflow Forecasts will show exactly how much money is coming in over
the forthcoming weeks or months.
Increased Productivity
The productivity of your collections department can be increased, which
would save overhead costs:
Instead of having a collector calling for each individual invoice,
the automatic email feature can send summaries
of all outstanding invoices to the debtors.
As the entire process of collection is recorded, there is very
little chance of unnecessary repetitive work.
Collectors don’t need to manually do reconciliations for the
debtors, as will be readily available together with
the contact information.
Performance Incentives can be implemented as you will have to
monitor and measure productivity.
Collectors will be aware that management can monitor and measure!
Depositing the money in the bank:
If you bring your book down by $50 000, you will be saving $8 000
per annum at today’s interest rates.
The quicker you collect your money, the healthier the bank account.
This product qualifies for quantity discount pricing.what's this?
