Top 4 Ways Collections Management for Microsoft Dynamics GP Can Benefit Your Bottom Line

Everyone knows collections is not fun. Thankfully, with the power of Collections Management by Professional Advantage you don’t have to stress over this process. Collections Management for Microsoft Dynamics GP will streamline your Accounts Receivable (A/R) so you know what to collect, when to collect and who to contact. Even better, Collections Management will automatically tell you when a customer needs a phone call or collection letter based on customer-specific collection plans.

Encore Business Solutions has been partnering with Professional Advantage for several years to implement this solution for their Microsoft Dynamics GP client base.  If your company has A/R, be sure to reach out to Encore and ask about Collections Management today.

The top 4 ways Collections Management can benefit your bottom line:

1. Decrease your days’ sales outstanding (DSO)
   Days Sales Outstanding is an important statistic for your Accounts Receivable.  It’s calculated by taking your A/R divided by your invoiced sales in a particular period, times the number of days in that period. DSO indicates how much you’re selling and how fast you’re getting paid. So if you think about that, DSO can really indicate how efficient your collection process is working.Here’s an easy example: $36MM Company = $3MM/month or ~$100K/ day. If you bring your DSO down 5 days, that’s another $500K in your bank.

   If your payment terms are Net30, a reasonably good DSO is under 40 days. With Collections Management, you can track this over time and realize your Return on Investment.This may be the most apparent benefit from Collections Management attributing to your improved bottom line.

2. Centralize customer payment history and notes
   With out-of-the-box Dynamics GP there is nowhere to centralize customer payment history or record notes of conversations with clients. You can find yourself in many different areas of the A/R module trying to gather the information you need. The ‘Main’ window of Collections Management is a command center used for tracking notes, setting follow ups, assigning actions on invoices such as promised payments and disputes and provides great ad hoc inquiry.Dynamics GP has out-of-the-box OLE notes, but these don’t really serve the purpose of collecting. Some companies keep notes on paper, some use a shared excel file, but with Collections Management, the Collection Notes are right there in GP. Collection notes have traditionally been the hub of Collections Management. They allow you to create actions, keep history, and notes on customer invoices. Notes can also act as follow up tasks.

   Centralizing contact and collection information is going to boost efficiency and increase your bottom line.

3. Automate and streamline follow ups and collection activities
   Collections Management includes many features to automate the collections process.  With a feature called ‘Collection Plans’ the system will suggest not only the customers to contact, but will automate the steps in your collections process. Spend less time searching for customers, creating emails and attaching invoices manually. Specifically, Collection Plans are a workflow of actions or steps that are suggested automatically based on the due date of an invoice. Users have access to pre-defined plans or can define plans from scratch, tailored for different customer types. Processing of the actions suggested by plans can be executed in similar groups, one by one, or all at once.Less time spent organizing data and communicating, allows you to focus on other activities to increase your bottom line.

4. Allows for easy reporting
   Collections Management includes a summary window which gives you an Account Receivables summary, a breakdown of your notes and note categories, and aging. Users can view data by collector, by national account, or by a group of customers. The solution also comes with SmartLists which are great for dissecting data and reporting, and includes an individual collector performance report. There are two SSRS report templates which have drill down features and can be enabled to be sent weekly to your Controllers or Management team. Lastly, there are note detail reports that can be printed right from within Dynamics GP.Problem customers and collector inefficiencies can be targeted and dealt with can reverse any decrease in your bottom line.

Bottom line (no pun intended), Collections Management is going to allow you to reduce your bad debt and improve your cash follow. This comes from a culmination of the previous points mentioned in this article and the many other features of Collections Management.

Reduce bad debt = increase in bottom line.

For more information about Collections Management, contact your Encore Business Solutions Account Manager today.