Anyone who has been in business for even a short period of time knows that money basically governs everything. Without a healthy cash flow, it’s next to impossible for a business to operate efficiently, and it’s for this reason that sales people and those who bring in the cash are often looked at as the “rock stars” of the office. All this said, many people often forget the importance of analyzing and improving the order-to-cash process, often referred to as OTC or O2C. It’s certainly easy to overlook, but doing so will not do a single favor for your business.
The fact is, improving your OTC processes doesn’t have to be nearly as difficult as you might think. There are plenty of things that you can do to smooth the situation over, and even if it takes time out of your normal routine, it’ll be more than worth your while. Consider the following tips, each of which can help you to perfect your order-to-cash processes.
Optimizing Your Order-to-Cash Processes
Understand Your Customers
There are plenty of technical ways to improve your OTC processes, but in the end there’s simply nothing more important than understanding your customers as well as possible. Keeping a history for each customer that helps to clarify their actions past and present, profitability, amount of complaints/returns etc. can make it far easier in the long run for you to understand what to expect. Analyzing this information on a regular basis is perhaps the most important thing you can do to improve your order-to-cash processes, and it doesn’t have to cost you a dime.
Give Your Sales Team Constant Reminders
Your sales team is everything, and there’s no getting around the fact that they have a huge impact on your OTC processes. It’s important to remind the team that they need to keep on clients and customers and be adamant about payment terms. This information can sometimes get lost in the shuffle, and allowing this to happen won’t do your business any favors whatsoever. Scheduling regular meetings with your sales team is an essential part of keeping the communication loop healthy and should never be underestimated.
Have a Solid Plan for Collections
No matter how much faith you have in your customers, you’ve got to accept the fact that there are going to be times in which you’ll run into those who don’t pay up. It happens more often than most people would like to admit, actually, and can severely impede your order-to-cash process. This being said, you’ve got to have a solid plan for collections if you have any intention of getting the money that is owed to you within a reasonable amount of time. Whether you decide to hire a collection agency or handle the issue in-house, you’ll have a much better chance of getting your money if you have a plan in place.
Optimizing your order-to-cash processes can surely take time and a lot of effort, but it doesn’t have to be anywhere near impossible. So long as you make a plan, you’ll be on the right track.