The InvoiceSherpa Blog

Accounts Receivable Automation Use Cases

You’ve probably heard all about the benefits of AR automation, from fewer clerical errors to reduced cash flow problems, improved operational efficiency, and a whole lot more. 

But how does this work - what are the specific accounts receivable automation use cases that make this such a great investment in your financial management? 

We’re here to break it down and help you get started harnessing the power of automation today. Here are the most exciting use cases you need to know about:

These are just the tip of the iceberg, too, when you leverage the best AR automation software: InvoiceSherpa. Our solution can help you get paid faster while eliminating the stress and complexity of managing your own AR processes. Get started for free today and see what’s possible!

What is Accounts Receivable (AR) Automation?

Before we dive into the use cases, what is AR automation exactly? 

Simply put, this is the use of technology to reduce manual input in managing your accounts receivable process - from generating and sending invoices to tracking payments, issuing follow-ups, and consolidating everything over into your accounting system.

Let’s take a step back and discuss the traditional AR process first to understand why automation is so powerful. It’s prone to human error and it’s incredibly time consuming. 

Common challenges in traditional AR management include delayed payments, human errors in data entry, inconsistent follow-ups, and the administrative burden of tracking outstanding invoices. 

As we discuss in our guide how do cash flow problems usually start, this is an area of your business worth investing in. That’s where automation comes in. It handles repetitive and time-intensive tasks, reducing the need for manual intervention and minimizing the risk of errors.

Compared to accounts receivable management services, it’s far more cost-effective - which is especially appealing to small and mid-sized businesses operating on thin margins. Sure, you could outsource AR for a few thousand dollars a month - or you could automate it for $49!

All that being said, let’s get into some of the accounts receivable automation use cases that are going to save you time, stress, and most importantly, money. 

The Most Exciting Accounts Receivable Automation Use Cases to Streamline Your Processes

From sending out invoices to scheduling automatic reminders, adding late fees, reconciling payments into your account software, and more - the possibilities are endless when you invest in the best automated invoice processing software

Streamlining Invoice Generation and Sending

If you’re still sending clients invoices manually, it’s time to stop working harder and start working smarter. You can effortlessly send them a link with their invoice, or better yet, a link to their own personalized portal, where they can view all invoices, outstanding and past.

This ensures consistency and accuracy, eliminating the risk of manual data entry errors. It also creates a far more frictionless experience for customers, ensuring they pay faster. 

If a customer has to take a piece of paper, call you/login, and then manually enter their payment information, they’re more likely to procrastinate. Make it easier for your clients to pay you!

Automatic Payment Reminders

One of the most time-consuming tasks in AR management is following up on unpaid invoices. You might feel like you spend more time chasing down late payments than you do actually generating additional sales for the company.

You can use software to schedule an automatic overdue payment reminder email or SMS to clients based on customizable inputs. These reminders can be tailored to include friendly messages, due dates, and payment options, encouraging prompt payments. 

Handling Late Payments and Fees

Dealing with late payments can be a headache for any business - and while the first two use cases will help ease this frustration, it won’t eliminate it altogether.

Fortunately, AR automation software can automatically apply the maximum invoice late fees by state to overdue invoices and send notifications to clients about these charges. You can also customize your invoice late fee wording to align with your brand’s tone.

The system can also escalate the collection process by sending more urgent reminders or transferring the account to a collections team if necessary. You won’t have to worry about how to send an invoice to collections manually, and you’ll dramatically improve cash flow.

Customer Portals for Easy Payments

We briefly touched on this use case earlier, but giving your clients their own portal to manage payments is one of the most compelling benefits. 

Here, clients can view their invoices, make payments, and manage their accounts. It simplifies the payment process by allowing clients to pay directly using various methods, such as credit cards or ACH transfers.

Recurring Billing for Subscription Services

If you offer subscription services or recurring products, managing recurring billing manually can be cumbersome. This is common for lawn care clients, software companies, and many more. Why continue to send the same invoice over and over when you could set up recurring billing?

AR automation software can handle recurring billing effortlessly, automatically generating and sending invoices at regular intervals. 

You can even take this a step further to automatically charge a client’s card at the start of every billing cycle so they don’t have to lift a finger to continue using services. Again - the goal is to reduce friction for customers, as this will improve their experience while getting you paid.

Intuitive AR Reconciliation

One of the best accounts receivable automation use cases is reconciliation from payment processing over to your accounting software. This process is particularly prone to clerical errors, and it’s also hard to manage manually. 

But with a billing automation system like InvoiceSherpa, accounts receivable reconciliation happens automatically without you having to do anything. 

It matches any payment captured with the outstanding invoice. It can also identify discrepancies, such as overpayments or underpayments, and update the accounting records accordingly. This keeps your financial records accurate and up-to-date.

Reporting and Analytics Insights

Whether you’re forecasting accounts receivable or trying to look for room for improvement in your cash flow cycle, having access to reliable analytics can be a game changer.

The right software empowers you with comprehensive reporting capabilities, offering insights into payment trends, outstanding invoices, cash flow, and a whole lot more.

These reports can be customized to meet specific business needs and can be generated on-demand or on a regular schedule. Either way, you’ll be able to make more informed decisions to optimize your financial processes going forward.

How to Get Started with InvoiceSherpa Today

Excited about the possibilities with AR automation and ready to take the first step today? We’ve made it quick and easy to harness the accounts receivable automation use cases with our AR automation software here at InvoiceSherpa. 

Learn what separates it from the rest and gain tips on how to automate accounts receivable below!

Why InvoiceSherpa is the #1 Choice for AR Automation Software

Automation: InvoiceSherpa automates the entire AR process, from invoice generation to reconciliation in your accounting software, along with every nuanced step in between. It saves you time and money while helping you get paid faster.

The software supports integrated payments so customers can pay directly from invoice reminders via credit card or ACH. This simplifies the payment process and enhances cash flow by making it easier for clients to settle their accounts.

You can even send out customized reminders via email and SMS - when an invoice is created, past due, and when payments are received, you and your customers are kept in the loop every step of the way so everyone is on the same page.

The customer portal allows clients to view, pay, and manage their invoices online. They can even set up recurring billing so they don’t have to manually pay every month if necessary. Once customers do pay, though, the payment syncs over to your accounting software in a snap.

You can integrate with Quickbooks, Xero, Clio, PayPal,, Stripe, and many other popular solutions to make sure your business is interconnected seamlessly.

Brands like Patagnoia, Datanyze, Smartsheet, Yieldmo, and many others have already made the switch, and you can too. With a 14-day free trial, what do you have to lose? Here are some tips on getting started today…

Tips on Getting Started

  1. Create your account: Start by getting set up with an account at InvoiceSherpa and connecting your payment processor, your accounting software, and configuring any other integrations.
  2. Setup your customers: Choose the customers you want to bill, determine the ideal payment gateway, and pull in your invoices.
  3. Schedule reminders: Hopefully your clients pay right away - but if not, we’ll handle the heavy lifting of sending out structured reminders on a routine basis. Customize the verbiage and choose the schedule, we’ll do the rest.
  4. Get paid: The moment a customer settles their invoice it syncs over into your accounting software and closes out the invoice.

It’s really that easy! You can learn more about accounts receivable automation best practices or other small business accounting tips in our blog to set yourself up for success. We have resources on how to find accounts receivable, accounts receivable challenges and how automation can help, unbilled receivables, demand for payment letter, and more.

At this point, though, why not take the first step in trying out some of these accounts receivable use cases? Take control of your financial management with InvoiceSherpa today!

Wrapping Up Our Guide to Accounts Receivable Automation Use Cases

As you can see, there are a variety of use cases for AR automation - each of which can save you time and stress while helping you accelerate your cash flow cycle.

From generating invoices to managing payments, AR automation is the way of the future. The only thing left to do now is take the first step and discover firsthand what it can do for your business. 

With InvoiceSherpa, it takes just a few moments of set up and will save you hours of work going forward, all while getting you paid faster and offering a better experience for your customers. At just $49/month, what more could you ask for?

Start your free trial today and see for yourself what you’ve been missing out on.

July 3, 2024

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