How does your account receivables department measure up to the U.S. average of past due and uncollectable invoices? Great ready to sit down and analyze your workflow process, because here are the numbers from the most recent Atradius Payment Practices Barometer.
In the United States, the average from all interview companies was 46.6% of domestic invoices were past due. Foreign invoices aren’t any better, at a staggering 56.3%. Finally, the reported number of uncollectable invoices averaged 2.5%.
How are you doing? If you are one of the lucky one's celebrating, good job! Pat yourself on the back, you’ve earned it. If you are thinking, “Huh. I’ve got some work to do,” it may be time to invest several hours in going through your accounting software and see what can be adjusted to get those numbers down. Whatever you do, don’t panic and don’t despair. There are many practices available to help you reduce those numbers. Many late payments are the result of simple human errors, such as sending the invoice to the wrong person, or sending invoices with incorrect information.
Make sure the invoicing software you’re using for your account receivables is helping you reduce human error. Also, offering user-friendly bill payment services could make the process a lot easier. If you want to put the process on autopilot, try an invoicing software with credit scoring and automated reminders to help get those numbers down for you.