accounts receivable management software buyers guide

Anytime Collect- by e2b teknologies 440.352.4700 | www.anytimecollect.com

Accounts Receivable, Credit, and Collections Software Evaluation

2015 A/R Software Market Overview and Application Evaluation Tips

James MalloryMarch 31, 2015


1980-1990’s

ERP gains traction & popularity among manufacturers, distributors, service-driven organizations, and others

1990- 2000’s

- Salesforce automation (SFA) software morphs into CRM

-Mainframe migration to PC

-Migration from MS DOS and UNIX to MS Windows

-Cloud Computing emerges

Today

Just like the movement to ERP in the 90’s companies are adopting A/R management software to fill the gaps & integrate strategic business areas into one place.

Evolution of Business Technology


A/R Software Today• Maturing and evolving market with more applications to choose from

• Small business systems - a growing market

• MANY new cloud-based systems, most with limited functionality

• Subscription ranging from $20 to $200 per month

• Mid-Sized systems- highly fragmented market

• Few systems launched in the last 5 years or so designed for growing companies

• Most established vendors offer on-premise and hosted deployment models

• Large Enterprises- limited market

• Few options available on the market today


What Can You Do With A/R Collections Software?

Extend the A/R module in ERP/accounting systems with advanced features that allow you to:

• Automate broken promise tracking• Report on critical A/R information• Centralize information from your ERP system• Enable customer self-service and online bill pay• Manage and collaborate on important documents• Manage & automate communications related to

invoices• Set up alerts and notifications• Much more.

Our Buyer’s Guide & RFP template lists over 320 features available in some of today’s popular A/R software applications.

Available here: blog.anytimecollect.com/accounts-receivable-software-buyers-

guide-white-paper/

blog.anytimecollect.com/accounts-receivable-software-buyers-guide-white-paper/


A/R Software Value Proposition


Get paid faster

• Companies using CCM software get paid about 20% faster than companies who use manual or disconnected systems.

• On average companies get paid in 61 days despite 28 day credit terms.

• A 20% improvement means you get paid 12 days (almost 2 weeks) faster!

(Paystream Advisors)


Reduce Bad Debt Write-Offs

• Companies write-off 4% of accounts receivable annually to bad debt.

• Companies implementing CCM typically reduce bad debt by 15-25%

Example savings:

$10 million company is writing off $400,000 annually. A 20% reduction provides a savings of $80,000 annually.

How much would you need to sell to make up for that loss?(Paystream Advisors)


Increase efficiency

Spend 3X as much time and energy communicating with customers about payment -not on administrative tasks.


Rapid Return on Investment

Recent research from industry Analysts Paystream Advisor shows that companies who use A/R management software to automate collections are realizing ROI in as little as 2 months.


Additional Benefits

• Increase working capital• Increase efficiency• Improve communication• Improve customer service• Reduce Admin costs• Shorten the sales to payment cycle• Minimize credit risk• Gain valuable insight• Centralize information• Reduce legal costs• Peace of mind

• Get paid faster• Improve cash forecasting• Resolve disputes faster• Reduce financing costs• Maximize unused credit lines• Reduce bad debt write-offs• Improve borrowing position• New employee training• Reduce dependency on collection agencies• Reduce legal costs• Simplify audits & compliance• Improve cash position


Software Selection Criteria• Using the right tool for the job

• The right sized solution

• Specialty & industry specific applications

• Collection Agency Software

• Additional Software Considerations

• Vendor Longevity & Experience


Manual Systems, Spreadsheets, & Processes

• Not every business needs to invest in A/R software

• Manual processes may be suitable for companies with less than 100 active

customers or less than 100 invoices to manage monthly.

• As you increase your customer base or invoice volume, this strategy

becomes significantly more difficult.

• Remember: With A/R automation, companies can spend 3X as much time and

energy talking with customers, not working on spreadsheets!

The right tool for the job


“In the past, ERP solutions have been woefully inadequate in terms of credit and

collections functionality”

-Paystream Advisors

ERP / Accounting Systems


• Limited capabilities• Lack workflow automation• Require manual data entry• Lack reporting capabilities• Do not support quote-to-cash process• Ineffective & inefficient

Activity Average time with ERP

Average time with

accounts receivable

software

Research account

information5-10 minutes 2 minutes

Actual phone call with

customer10-15 minutes 10 minutes

Post-call activities 10-15 minutes 4 minutes

Total time spent 25-40 minutes 15 minutes

Customer Value Group

Time spent on single activity manual vs. automated


Customer Relationship Management (CRM)

CRM

Marketing

Sales

Support

Customer Service

Both CRM & A/R Software: • Allow users to manage accounts & contacts• Allow for Communicate• Have built-in reporting and intelligence capabilities

However, CRM is designed for sales – not for accounting!

CRM cannot answer critical collector questions such as:• When did I last remind the customer of an outstanding invoice? When should

I send another reminder? • When should I make the first call? second?• What is the procedure for a dispute? • When was the last time we conducted a credit review on this customer? • What is the process • for escalation when larger invoices continue to age?



Home Grown & Custom Applications

CCM software companies do one thing – they develop CCM software! 10 years ago you may not have been able to find a solution flexible enough for your business, but things have changed.

You have specific needs, but you have more important things to do than develop and maintain software, such as:

• manufacturing products• servicing customers• distributing goods



• Highly specialized software designed specifically to help companies manage

accounts receivable, credit, and collections.

• Integrated to ERP/accounting software to centralize customer accounts,

invoices, and payments.

• Proven to help companies get paid faster, reduce bad debt, and more.

• 10 – 20% reductions in daily sales outstanding (DSO)

• 25% reductions in past due receivables

• 15 - 25% reductions in bad debt reserves

• ROI in as little as 2 months.


Paystream Advisors Report


• No formula for calculating the size you need.

• Most A/R software systems integrate with specific ERP solutions which are segmented by company size & complexity.

• In our experience:

• Businesses typically have one full time employee managing every $10 million to $20 million in annual credit sales.

• This can vary widely by industry.

The right sized solution


Small Business A/R Software• Most small businesses don’t need CCM software until they are managing about 100

customers or 100 invoices monthly.

• Typically support a single user.

• Most of the entry-level CCM products are offered as hosted solutions available for subscription pricing for under $100 per month.

• Many small businesses use their QuickBooks system for A/R management• Basic features allowing for reminders to be sent to customers and for notes to be made for collection calls.

• Other light CCM products are available on the Intuit marketplace including Anytime Collect for QuickBooks.

Anytime Collect provides a dashboard, cash forecast, customizable email templates, configurable workflow, prioritized call list, and other

features not available in other products at this price point.



Mid-Market A/R Software• Companies with between $10 million to $500 million in credit sales with average of

5-10 full time credit users.

• Sage, Microsoft, and similar ERP vendors have options available including solutions developed exclusively for their ERP system.

• General products are also available on the open market in hosted or on premise deployment models.• Prices typically range from $100 to $300 monthly for subscriptions or generally around $1,000 to

$3,000 per user for a perpetual license purchase.

• Most midmarket companies will require at least 2 users.• Our average midmarket customer has 3-5 full credit users + several inquiry users who can receive

alerts and inquire on information in the software.



Enterprise A/R Software

• Integrate with SAP, Oracle, or other large ERP systems. • A/R modules can be overly complicated for smaller divisions

• Long implementation timeline

• Many use midmarket software like Anytime Collect in subsidiaries

• Enterprise CCM is typically available either hosted or on premise

• Prices from $5,000 to $15,000 per credit user.

• At Anytime Collect, our Enterprise customers range from smaller divisions of global enterprises with few users to Global companies with hundreds of users.

• Implementations typically require a few weeks to a month for system configuration, setup, and user training.



Specialty & Industry Applications

• Construction companies- lien management

• Transportation and logistics companies - disputes related to freight invoices & access to information not typically included in out of the box CCM software.

• Professional service firms, manufacturers, distributors, and others- supporting documents related to invoices (timesheets, proof of delivery, bills of lading, etc.)

• Medical & healthcare –compliance with HIPA, collections from multiple sources for co-pays and/or multiple insurance providers.

• Specialized applications generally do a great job with the industry-specific requirements but often lack the robust features included in most general applications.


Agency Collection Software Business Collection Software

Collection Agency Applications

• Software applications designed for Collection Agencies is different than those designed for

businesses.

• Difficult to tell the difference between collection agency software and CCM business

applications at first glance.

• Subtle differences, drastic impact.


Choose Your Vendor Wisely

Vendor Longevity & Experience

• Understand the background of each CCM vendor• Markets they serve• Product features• Other considerations

• Many companies (especially newer cloud CCM vendors) did not exist just a few years ago

• It is also important to understand how each vendor integrates their business applications with your ERP or accounting software.

• select a vendor with a solid background and reputation in the industry with a strong integration strategy to ensure your success

• Few CCM vendors have a strong background in ERP business software


• General Features

• Technology

• Hosted vs. Premise

• User Types

• Accounts

• Financial Transactions

• Automation & Workflow

• Collection Activities

• Business Intelligence & Reporting

• Business Credit Risk Management

• Electronic Invoice Presentment & Payment (EIPP)

• Document Management

• Cash Forecasting

• Global Features

• Professional Services

• Project Management

• References & Resources

• Pricing & ROI

Additional Software & Vendor Considerations


Make a more educated choice with these resources:

• 2015 A/R Software Buyer’s Guide• Current A/R market overview

• List of popular solutions to consider

• Vendor & software evaluation best practices

• Request for Proposal Template

• Over 320 features in popular A/R solutions to streamline the evaluation and selection process.

• ROI calculator• Enter your company data to get a potential ROI on software investment

Available here: blog.anytimecollect.com/accounts-receivable-software-buyers-guide-white-

paper/

blog.anytimecollect.com/accounts-receivable-software-buyers-guide-white-paper/


• Recorded Product Demonstrations

• White Papers

• Customer Case Studies

• Educational Webinars

• Other Resources

Download the Resource Guide here: anytimecollect.com/Pages/Resources.aspx

Additional Resources Available

http://anytimecollect.com/Pages/Resources.aspx


Download these white papers here: anytimecollect.com/Pages/Resources.aspx

http://anytimecollect.com/Pages/Resources.aspx


Questions?

James [email protected]

www.anytimecollect.com

mailto:[email protected]

http://www.e2benterprise.com/