7 reasons why outdated AR processes frustrate customers

A smoothly running accounts receivable (AR) operation can provide customers with an experience that leads to increased sales and loyalty for suppliers. However, an operation that relies on outdated manual processes can have the opposite effect.

Today, 66% of B2B buyers say they expect B2C-like experiences on B2B e-commerce sites, which means near-instant credit decisions, 24/7 account maintenance, electronic billing and multiple payment options. Not meeting these heightened expectations can lead to customer dissatisfaction and decreased customer loyalty. Additionally, suppliers who manage their AR programs in-house with manual processes face risks, including fraud and nonpayment.

Here are seven common reasons why outdated AR processes might lead to customer frustration and retention risks:

1. Waiting days for credit approval
2. Billing formats that don’t meet customers’ preferences
3. Customer service limited to digital self-service, without live agents
4. Lengthy manual payment reconciliation processes
5. Reliance on paper checks for payment
6. Disjointed customer communications
7. Limited visibility into past purchases and itemized invoices Meeting the shifting expectations of customers can be a challenge. But it doesn’t have to be.

There are two main approaches to AR that can help B2B enterprises better meet these expectations:

1. AR automation software. This includes point solutions that automate one or more steps in the order-to-cash cycle—like online payments, billing reminders and payment processing—which can be useful for augmenting in-house AR programs. However, Forrester Senior Analyst Meng Liu notes that this patchwork system of software can lead to poor outcomes, writing, “Many businesses still use multiple disconnected systems to manage AR. Siloed systems result in increased complexity, operational inefficiencies, data integration challenges, limited reporting, and too many reconciliation points.” Liu adds, “Businesses are in urgent need of a fully integrated and unified solution that can support multiple digital payment methods.”
2. End-to-end AR solutions. These nuts-to-bolts solutions provide technology-oriented, digital-first experiences that optimize the order-to-cash cycle, provide back-end integrations and redefine the customer experience.

However, even if enterprises deploy solutions on their own, they’re still left with the inherent cash flow and risk burdens. To address those pain points, they should consider a full-service AR solution from Capital One Trade Credit. This solution can transform an outdated in-house program into one that is tech-oriented, digital-first and optimized while also improving a supplier’s cash flow and protecting against the risk of fraud and nonpayment.

Download our latest e-book to learn more about modernizing your AR processes, including:

• 4 signs that it’s time to make a change
• How a major online retailer and technology provider meets B2B customer expectations
• How leading digital-forward organizations have set the bar for B2B customer expectations
• How a full-service AR solution compares with AR automation software