• Solutions & Services
    • ERP Payment Services Integration
    • Ecommerce Payment Services Integration
    • Sales Tax Calculation & Remittance
    • QuickBooks Payment Services Integration
    • Payment Solutions
    • Global Check & ACH Payment Processing
    • Self-Service Payment Portal
    • International Merchant Accounts
    • Mobile Hardware Devices
    • High-Risk Solutions
  • Industry Verticals
    • Business & Ecommerce
    • Government & Municipalities
    • Retailers
  • Library
  • Why Juno
    • How are we different?
    • Giving Back
  • Contact
    • Contact
    • Frequently Asked Questions
  • Sign Up
Juno Payments
  • Solutions & Services
    • ERP Payment Services Integration
    • Ecommerce Payment Services Integration
    • Sales Tax Calculation & Remittance
    • QuickBooks Payment Services Integration
    • Payment Solutions
    • Global Check & ACH Payment Processing
    • Self-Service Payment Portal
    • International Merchant Accounts
    • Mobile Hardware Devices
    • High-Risk Solutions
  • Industry Verticals
    • Business & Ecommerce
    • Government & Municipalities
    • Retailers
  • Library
  • Why Juno
    • How are we different?
    • Giving Back
  • Contact
    • Contact
    • Frequently Asked Questions
  • Sign Up

Juno Payments > Articles by: Gordon
22
Mar

Avoid The Dunning Process

AP/AR AutomationGordon

How the Dunning Process Works and How to Avoid It

Dunning is derived from a 17th century verb (dun) which means demanding payment of a debt, it represents the steps taken to collect overdue balance.  As accounts become more overdue, this process can become increasingly invasive.

The first step is normally a letter that outlines the late payment per the previously agreed upon payment due date.  Some institutions have systems in place that automate certain aspects of the dunning process, they include tracing customers who have pending payments, to notifying and involving collection agencies.

 

The severity of collective actions is determined by several contributing factors such as how long overdue the payment is, the amount of the payment, and the relationship between the two parties.  Once collection agencies are involved, they will go through internal processes of collection which include everything from simple notices to serious legal actions.

How can this nightmare of a scenario be avoided?  Most would think it is fairly simple, pay your invoices on time.  But as we all know, depending on your internal AP/AR processes, this is not always as simple as it sounds. 

One way is to maintain a trustworthy team managing your internal processes, who would ensure those process continue to evolve and become more efficient. Granted, there will always be anomalies, but hopefully not enough to find yourself fighting your way out of a dunning process.

Keeping healthy business relationships is another way to minimize your dunning risk.  Collection agencies only become involved in the dunning process if the payee requests them to be.  This can often be avoided by keeping positive and respectful working relationships, and by letting them know they are valued.  A business relationship is often more important than a single invoice.

Dunning process damages your credit rating and lowers your ability to obtain favorable payment terms.  If the root cause for missed payment is due to errors and bottlenecks in your AP organization, there is no reason these cannot be eliminated, it makes good business sense. 

The easiest way to avoid late payments and dunning processes is true automation.  Juno Payments offers a solution to fully automate your procure-to-pay and order-to-cash processes.  It removes late/missed payments due to human errors and bottlenecks, your focus can shift from chasing payments to never missing early payment discounts.  

We would appreciate an opportunity to work with you and share how this can be accomplished.

Want to Learn More?

1-888-514-8118

[email protected]

Connect via LinkedIn

www.junopayments.com

Read More

14
Mar

Are You Keeping Up with Other Finance Leaders in Effective Cash Management? – Part 1

AP/AR AutomationGordon

Are You Keeping Up with Other Finance Leaders in Effective Cash Management?

Part 1 – Executive Summary and Drivers for Change

There had been a number of recent studies on what finance executives have done to improve their cash management effectiveness.  In a series of weekly articles, we will be providing insights into the key findings and lessons learned from these studies and from our own experience.

Executive Summary

To improve cash flow and deliver effective cash management, senior finance leaders are playing a large role in modernizing their organizations.  Their top three functional drivers include improving visibility, reducing cost, and eliminating paper-based documents. 

While 3 out of 5 are investing in solutions to standardize and automate their AP/AR and cash forecasting operation, only 1 in 4 are making significant progress.  What the research data fell short is explaining the real reasons behind the slow progress, so you can act on the root-cause instead of observing the symptoms. 

This is where our experience fills in the gaps – because a purposed-built, fully integrated solution was not available at the time.  Rather than tackling the holistic problem, many were forced to break it down into a collection of distinct projects, each addressing a small aspect of the overall challenge.  Due to the intricate interdependence amongst these parts, the envisioned result is unachievable in isolation, which explains why the success rate was so low.

This is not unlike comparing a NBA team with an intramural team.  They all have the same number of players on the court, share the same goals, same rule, and court regulation.  But the outcome is drastically different, the devils is always in the details. 

Drivers for change

For this week, we will look at into those external and internal drivers that motivated these executives to act:

  • In today’s connected enterprise, the AP/AR organizations can no longer operate as its own island:
    • 81% are seeing greater collaboration with their suppliers and other enterprise functions.
    • 79% are seeing greater enterprise demand of invoice information, such as integration into their ERP and procurement systems.
    • 64% are seeing further increase in strategic importance for their AP/AR departments. New tasks include business analytics, dynamic cash forecasting, correlations of data and drivers, etc…
  • Investors and analysts are increasingly focused on cashflow as a top financial metric.
  • More accurate prediction of cash flow against current/future expenses.
  • Lack of visibility into existing AP documents and operation for effective oversight and control.
  • Difficulty in searching and managing paper-based documents.
  • Increasing regulatory compliance requirements.
  • High cost of invoice processing.
  • Increasing payment-related fraud.
  • High percentage of AR exceptions is increasing the Days Sales Outstanding (DSO).
  • High DSO is negatively impacting cashflow, liquidity, and working capital.
  • Lack of accuracy and timeliness in payment processing.

We hope this set of drivers resonate with you and help you to identify those latent requirements that have yet to be defined.  We would love to learn from you those needs that are unique to your firm, or those that we have missed.

Next week, we will discuss the set of business and functional requirements derived from these drivers for change.

 

 

Want to Learn More?

1-888-514-8118

[email protected]

Connect via LinkedIn

www.junopayments.com

Read More
27
Feb

When Is The Best Time To Pay Your Invoices?

AP/AR AutomationGordon

When Is The Best Time To Pay Your Invoices?

There is no one answer to this question.  It depends very much on your strategy, the cash flow situation and your credit rating.

 

DPO vs. DSO – a cash flow consideration:  First and foremost, you do not want to pay your vendors quicker than your customers pay you.  This can be seen when comparing your DSO and your DPO – your DPO should be higher than your DSO.  This can be achieved by how you design your contracts payment terms with your vendors and your clients, as well as your collection process efficiency.

 

Payment Terms:  Your vendors are usually willing to give more favorable payment terms if you have a history of paying on time.

 

Credit Rating:  Major credit rating agencies have their own programs to review how much on time a company is paying.  One of the best known programs is D&B’s Global Trade Program, where your vendors are contributing customer payment patterns.  Paying constantly late can therefore hurt your credit standing and your overall reputation.  Or the other way around: paying on time reflects positively in your credit rating, which helps your vendor to make a favorable decision for you regarding the payment terms.

 

Early payment discounts:  There are two ways to benefit from early payment discounts: either a fixed agreement with the vendor that is already baked into the contract, or a dynamic discounting calculation to offer your vendors to get paid early.  Though that means you need to be able to process an invoice and have it ready for payment much quicker than the 16 days average, or even worse, the 35 days for the bottom 30%.  Without having the invoice ready for payment within a few days, chances are slim that you can take out the early payment discount.

Liquidity:  Your ability to pay an invoice on time is another determining factor.  A solid collection process and cash/liquidity forecasting based on historical payment patterns of your customers can help you predict your liquidity in the future.  You have to factor in seasonality, month, quarter and year end activities of your customers – as much as their way of paying you: a check still needs an average 7 days before you receive it, and it still needs to be cashed.

The more automated the forecasting process, the more precise it is.

 

Conclusion:  Automate your processes from invoice processing to billing & collection to liquidity forecasting, add your overall strategy and an automated forecasting model for your liquidity, and you will have the ability to optimize when to pay an invoice.

How we can help:  Juno Payments offers payment date recommendation engine as part of our invoice automation solution.  It takes into account all of the above plus more to recommend the optimal payment date, which will have the greatest financial impact on your company.  We look forward to working with you to optimize your AP/AR operations.

 

 

Want to Learn More?

1-888-514-8118

[email protected]

www.junopayments.com

Read More
  • 1
  • 2
  • 3
  • 4
  • 5
  • 6

Categories

  • AP/AR Automation
  • Blog
  • Case Studies
  • QuickBooks Integration
  • Sales Tax
  • 1-888-514-8118
  • [email protected]
  • www.junopayments.com
  • https://www.linkedin.com/company/7952279
websiteLOGOv2

Juno Payments provides financial automation, multi-channel integrated payment solutions for e-commerce, mobile, and standard merchant services.

We provide comprehensive solutions designed to directly impact our customer’s bottom lines. Let's build a solution that is right for you.

JunoPayments ©2019