Cash Manager

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Cash Manager

ERP solution, ERP software

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.

 Debtors Manager can help businesses overcome these problems

Debtors 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 Debtors 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.

 Debtors 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 Sage Debtors Manager work?

Quite simply, Sage Debtors Manager pulls through the Age Analysis from Sage 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, Sage Debtors 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 R50 000, you will be saving R8 000 per annum at today’s interest rates.
  • The quicker you collect your money, the healthier the bank account.

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