BECOME A REVENUE HERO CREDIT 2 CASH

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CREDIT 2 CASH SMART AR FOR SMART TEAMS BECOME A REVENUE HERO

Transcript of BECOME A REVENUE HERO CREDIT 2 CASH

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CREDIT 2 CASH

S M A R T A R F O R S M A R T T E A M S

B E C O M E A R E V E N U E H E R O

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Y O U A R E A R E V E N U E H E R O .Did you know that? Does anyone else?

This is the challenge when you work in accounts receivables. Logically, the business cannot function, much less thrive, without you. Without you, revenue does not come into the business. Cash is not applied to accounts. Debt builds with uncollected payments. Money is not available for things like employee paychecks and business reinvestment.

And yet the recognition and understanding that comes with such an important role is not there. Accounts receivables (AR) has been relegated to a back-office function – nothing to see here! Don’t peek behind the curtain.

The result is that while many aspects of business – sales, inventory and operations, marketing, customer support – have all been updated and automated, the basic functions of managing money and cash flow have been ignored.

This is your chance to drive the change. Now is the time to bring in smart AR tools for a smarter team. Now, finally, technology is catching up to ensure that not only do you enjoy the recognition you deserve, but that your job is a little easier, a little faster, and a lot smarter.

Understanding the accounts receivable process – from initial credit assessment through to cash application – is critical to identifying areas for quick improvements and long-term efficiencies.

The three key themes you will see play throughout this primer is data management, automation, and transparency. As you learn to apply these strategies to your credit to cash process, you will experience improvements in the health of your business across multiple facets, including cash flow, business reinvestment, customer satisfaction and employee productivity.

So, let’s get started…

THE REVENUE HERO’S MISSION.SHOULD YOU CHOOSE TO ACCEPT IT…

WHAT MANAGING BAD DEBT COSTS

COMPANIES

$137

,300

$17,200B

EST IN C

LASS

BO

TTO

M P

ERFORMERS

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CO

NTE

NTS

.THE CREDIT TO CASH PROCESS01

DISPUTE RESOLUTION12

ORDER MANAGEMENT05

PAYMENTS17

CASH APPLICATION25

CREDIT MANAGEMENT02

COLLECTIONS MANAGEMENT14

INVOICING07

DEDUCTION MANAGEMENT23

CREDIT TO CASH IN 2020: YAYPAY27

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SAVINGS = $130,000 PER 1000 INVOICES ANNUALLY

AUTOMATED BEST-IN-CLASS PROCESS = DOWN TO $0.71 PER INVOICE

APQC STATISTICS SHOW:

TRADITIONAL PROCESSES = UP TO $11.50 PER INVOICE

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THE CREDIT TO CASH PROCESSYou know the drill: there is a constant flow of incoming inquiries, receipts and requests, often in a combination of paper, voice and electronic forms. There is an ongoing stream of outbound communications, in the form of invoices, collections notices and customer service responses, also in a combination of paper, voice and electronic formats.

Keeping it all straight is quite a task. Manual. Labor intensive. Detail oriented. Also, repetitive and exhausting.

Not to mention the pressure of keeping the numbers straight – which payments are coming in via check, ACH, or credit card and to which invoices do they apply? How much of this is part of a late payment or why is this particular payment short? What happened to the remit?

Those outside of AR have no idea the complexity you deal with.

But you are a Revenue Hero. And your time has come.

This is your chance to drive the change. Today, the tools available for automation and machine learning in the AR process means you have smart tools for smart AR at your fingertips. This is a game-changer for you, the Revenue Hero, and for your business.

We are going to discuss the eight core components to the credit to cash process:

• Credit management

• Order management

• Invoicing

• Dispute resolution

• Collections

• Payments

• Deductions

• Cash application

Today there are opportunities to take a traditionally manual, labor-intensive process and create streamlined, automated processes that accelerate cash flow, drive higher operational efficiency, and create transparency throughout the business. When you fully understand the process, you will see the compelling opportunity in front of you to drive change for the benefit of all.

Why would you do this? Because you, more than anyone in your business, understand the importance of AR: the more efficiently this critical process runs, the deeper and broader the benefits are of increased revenue, improved customer satisfaction, reduced operational expenses and happier, employees.

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CREDIT MANAGEMENTW H A T I S I T ?This is where it starts. Credit management is the process of granting credit, setting the terms it’s granted on, recovering this credit when it’s due, and ensuring compliance with company credit policy.

Accurately assessing the credit worthiness of your customers directly impacts your ability to collect funds, manage cash flow and forecast cost of labor.

While a customer’s credit rating is one metric (and often the only metric) used to assess credit worthiness, proper analysis of customer data can provide important insights into who is actually a great, average, or poor customer.

T H E I M P A C T O N T H E B U S I N E S SCredit management for most organizations is a static and reactive process. Organizations typically review a customer’s credit rating from a partner agency, possibly review payment history, and place a cadence to review the account every year, unless there is a problem. Since pricing, terms and credit limits are all set at this early stage of the credit to cash cycle, not analyzing the complete spectrum of available customer intelligence could lead you to miss out on big revenue opportunities, while giving favorable terms and discounts to the wrong customers.

Credit management should be a continuous process - best in class companies have regular checkpoints built into their processes where they re-evaluate their customer’s credit rating and payment data in order to understand which customers may now be at risk and which continue to be in good standing. This provides the information they need to maintain accurate forecasting and revenue projections.

C O M M O N C H A L L E N G E SIn assessing and managing credit for the business, there are several key challenges that need to be addressed:

1. Data management. Though most organizations have volumes of incredible data about their customers, it is typically stored in disparate systems (ERP and CRM, for example) that are not connected. With different teams providing minimal data management, and no tool connecting the different pieces of data, there is no transparency between teams. Therefore, credit departments often lack visibility to useful information. This puts credit teams in a reactive rather than proactive position when it comes to managing customer accounts, and avoiding late payments and defaults.

2. Reporting and analytics. Often the tools available to credit analysts and managers are rudimentary and limited, due to the data challenges. With only nominal information, risk models are inaccurate and outdated, yet they are used to make decisions that impact the financial well-being of the business.

3. Lack of automation. The tools and systems in place at mature companies are often outdated. Outdated tools means outdated methods for inputting and updating data - it’s manual. And when you have to manually update data in different locations, the risk for error increases exponentially and sometimes important account details are lost. To figure out how to correct an error then becomes a manual hunt through the various data repositories, eating up time and resources with minimal benefit. The search for information is necessarily manual, and it takes time and resources to sift through different data repositories.

Lack of collaboration tools between sales and credit teams also creates additional labor costs (time wasted) and friction between these two groups.

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B E S T P R A C T I C E SGet access to more data. The simple first step is to utilize a third-party credit agency, if you have not already done so. This data can confirm any self-reported information by the customer and provide additional information regarding payment history, debt ratios, etc.

Provide visibility and transparency. Next, make the information visible to credit, collections, receivables and sales teams. Understanding the customer, from all facets, creates collaboration between internal teams and keeps business goals aligned.

Take advantage of automation. Traditionally manual and time-consuming tasks in credit management can be improved in both accuracy and efficiency. Some tasks that can be automated to save credit teams time and low-value effort are credit rating assessments, standard communications, and first line risk modeling. By having this kind of information automatically pulled and delivered to credit teams, they can quickly use the information to assess if a customer is growing rapidly and needs new credit terms, or conversely, if they’re about to get into trouble and therefore the credit team can proactively get ahead of it by working with the customer. This type of action not only saves the business money but also fosters a stronger customer relationship.

Invest in metrics and reporting. Pulling clean data about your customer into a single dashboard view and analyzing volumes of information to draw intelligence can be a bigger challenge, but it’s critical. Leverage automation tools to pull structured and unstructured data from a variety of sources into useful reports and dashboards. The ability for all teams to see actionable data and glean intelligent analysis impacts the ability to not only grant credit, but to collect revenue, manage cash flow, and overall grow the business. This allows teams to be proactive and strategic in supporting the business and customers, rather than just reactive and scrambling.

Build powerful partnerships. When looking at a credit to cash automation solution, focus on providers who enhance and build on the data and metrics you already have. You need a partner and a solution that delivers a deeper understanding of your customers and portfolios, has built advanced risk assessment capabilities with predictive analytics for payments, automates labor-intensive, repeatable processes, provides customer scoring, and can pull information from multiple systems in your organization.

M E T R I C S F O R S U C C E S S

• DSO

• Bad debt write-offs

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CREDIT FACTS & STATS

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OF COMPANIES USE AN OUTSIDE RESOURCE TO ASSESS CREDIT

OF SMALL BUSINESS OWNERS FUND THEIR

BUSINESS THROUGH THEIR PERSONAL CREDIT CARDS

OF COMPANIES SCORE THEIR CREDIT AND COLLECTIONS PORTFOLIO MONTHLY

ADMIT TO NEVER SCORING THEIR CREDIT AND

COLLECTIONS PORTFOLIO

90% 33%20%

24%

LOW – .065% (.00065 X TOTAL SALES)IDEAL – .2% (.002 X TOTAL SALES)GOOD – .3% (.003 X TOTAL SALES)

HIGH – .5% (.005 X TOTAL SALES)DANGER – 1.0% (.01 X TOTAL SALES)

BAD DEBT TO SALES RATIOS:

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ORDER MANAGEMENT W H A T I S I T ?Order management is the process of securing, tracking and fulfilling new orders. It begins when a customer places an order, and covers the people, processes and tools required to track that order until it is delivered. For some organizations, the fulfillment process might be cumbersome and highly complex, while for others it is quite straightforward.

T H E I M P A C T O N T H E B U S I N E S SHow efficiently this process is managed affects significant aspects of your business health:

• Cash flow: how quickly invoices are issued and paid

• Inventory management: how much product is sitting on shelves and in warehouses, costing you money to maintain

• Customer satisfaction: how happy are your customers and how likely they are to become repeat customers or refer more business to you

• Business growth: how well are your processes managed to accommodate scale and how easily you can acquire new business

C O M M O N C H A L L E N G E SThere are a few core challenges that must be addressed for successful order management.

1. Data Management. Capturing data and cross-referencing it between systems, in order to bill, fulfill and ship orders, is essential for an efficient process. However, many companies use multiple systems – one that handles billing and invoicing, one that tracks orders and inventory, one that manages the shipping process – that do not cohesively link. This creates gaps in information that can cost time, goodwill and revenue.

2. Automation. Capturing and updating information in your ERP or CRM, as well as fulfilling orders, tracking inventory and managing shipping, and mapping that all back to your accounting software, are all often disparate, manual systems and processes. These labor-intensive activities are slow, costly, and prone to human error.

3. Operational efficiency. It’s not just a cliché that time is money. The time lost executing manual processes, discovering and correcting errors, and managing basic data intake and updates is time that could be spent enhancing customer relationships and accelerating cash flow. Siloed functions and disparate tools for managing each step of the order management process is outdated and slows your ability to get paid.

4. Customer satisfaction. In today’s world of highly fragmented business and service offerings, your customers have choices. Slow order fulfillment, or incorrect data leading to incorrect orders, results in an increase in customer disputes, customer churn, and a decrease in cash flow.

5. Reporting and visibility. You can’t manage what you can’t see. If your data isn’t shared across your systems, you don’t truly have an accurate picture of your customer’s activity, or what’s happening inside your own business. Lack of visibility leads to problems with forecasting, budgeting, the ability to respond to urgent requests or order updates, and can lead to audit noncompliance.

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B E S T P R A C T I C E SIdentify all the different points of data collection in your order management process. Knowing what information is collected and stored where will help you determine the best ways to link the data flow so that there is transparency and information sharing between systems. Put self-service tools in place to allow customers to help manage their own data updates.

Automate key, repetitive steps. Data entry, order status and shipment tracking information are common areas that are often manual processes. Automated workflow processes ensure data is captured, extracted and routed to the appropriate personnel. Given that Hublogix’s recent study states there is one error for every 300 keystrokes, consider how many orders you process in a day and how much extra work those errors create.

Look for smart reporting and analysis tools. Create dashboards that share usable information – information pulled from your various data sources, and that allows you to understand inventory management, avoid waste with accurate forecasting, reliably project budgeting, identify customer patterns, and mitigate risk.

Tighten up your operational processes. 65% of returns are not the customer’s fault. Damaged items and receiving the wrong items are the top reasons for a return. Take a close look at your order management process. There are multiple pieces, people and processes that make it all work. Finding the interlocks and identifying where you

can automate a process, eliminate a step or implement a better system, all help you decrease errors, meet or exceed service level agreements (SLAs) and positively impact customer satisfaction. Simple things, such as ensuring that contact information is easily found on all communications and that online forms instantly send and track requests for support, are often overlooked. Yet these very basic steps are a significant source of frustration when a customer is trying to reach you to correct an order or report an issue.

Leverage your partners. There are myriad partners to choose from when it comes to improving the order management process. To maximize benefits to your business, find a partner with a collaborative platform that automates multiple business processes. A web-based workflow outside of your ERP provides flexibility, and seamless integration with your ERP and other business systems ensures data is shared across silos. Due to the complexity of the process, ensure your partner has a proven implementation and support process.

M E T R I C S F O R S U C C E S S

• Cost per order: reduction in processing costs

• Fulfillment accuracy: reduction in errors and associated costs

• Improved SLAs

• Increased customer satisfaction

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INVOICINGW H A T I S I T ?Invoicing is the process of creating and delivering invoices from your business to your customers. Invoices must be accurate, timely and clearly state amounts due, due dates, products or services rendered, an order or purchase number, and any associated terms for payment, such as types of payment accepted or time frame for payment discounts.

Some companies refer to invoices as bills or purchase orders. Invoicing may be one-time or for regularly recurring purchases.

T H E I M P A C T O N T H E B U S I N E S SInvoicing is the lynchpin of the order to cash process. It is the single most important document that drives payment. This means that the impact to the business when this part of the process fails can be damaging to the company’s health. The timeliness of invoices delivered has a direct impact on the timeliness of payment received. The accuracy of invoices affects not just the timeliness of payments, but also adds to the cost of invoicing by requiring additional time and man hours to correct errors. Both timeliness and accuracy impact customer satisfaction, as customers do not wish to spend time demystifying their invoices and struggling with channels for making payments. In the State of ePayables 2019 report, Ardent Partners reported that manual processes in invoicing and time spent correcting errors can more than triple the cost of issuing a single invoice.

C O M M O N C H A L L E N G E SThe invoicing challenges many businesses face include:

1. Data management. Visibility and transparency into customer data, order information and payment terms is critical for invoicing to be both accurate and timely. With many steps to the invoicing process still being paper-based and manual, sourcing the necessary information, and confirming its accuracy, can take up valuable time of AR teams.

2. Invoice Delivery. The traditional paper invoice is still the most common method of invoice delivery, and yet it is the slowest and most unreliable. It minimally takes 2-3 business days, and more often weeks, for a paper invoice to be delivered. And if there is any error in the address, it can take additional weeks for the invoice to be returned and alert the AR team that there is a problem. Customers who are moving more towards managing their bills and payments electronically may be frustrated by still receiving paper bills, and lack a process for dealing with them efficiently.

3. Manual processes. Historically, invoicing has been a highly manual, highly labor-intensive process: AR specialists key the invoice data into an accounting system before physically storing the paper document in a filing cabinet. New supplier information is entered using the organization’s naming conventions to avoid duplication. Both new and existing supplier information is checked for accuracy against internal sources, such as the master vendor file, and external sources, such as the IRS TIN matching service. This invoicing process is riddled with human error and manual labor delays, leaving money trapped in the process rather than reinvested in the business.

4. Customer satisfaction. There are few things more frustrating to your customers than taking time out of running their businesses to attend to an incorrect invoice. And even more aggravating is discovering a lack of credit available due to missing a payment on an invoice – one they may have never received, or got lost in their shuffle of postal mail. The inability of businesses to easily self-serve through an online portal to resolve issues, or to speak with someone who can quickly access accurate account date, has a serious detrimental effect on customer satisfaction scores.

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B E S T P R A C T I C E SAccess to data and analytics will go a long way. Two best practices to explore are:

• Customer portal: an online portal through which customers can self-serve will improve customer communications and accelerate cash flow. Customers with the ability to check their invoices on their own time, flag issues for dispute or pay through electronic channels will respond more quickly and take up less of the AR team’s limited resources.

• Internal dashboard: with immediate access to customer account information, AR and customer support teams can quickly help customers with questions and disputes. Cutting back time to resolve problems accelerates the payment process and leaves customers feeling important to the business.

Stop the manual data entry madness. Automation in the invoicing process can take significant time and labor out of the process, resulting in cost reductions, error reductions and faster payments. Key areas for automation are:

• the creation of invoices, leveraging multiple data sources

• delivery of invoices through email, online portal or postal mail

• issuance of payment reminders

• acceptance of payment, via ACH, bank wire or credit card

Bring your customers on the electronic journey. If you’re going to move to electronic invoicing, online portals and other forms of automation in your invoicing process, it’s critical that you bring your customers along on the journey. A communication plan is necessary to ensure your customers are aware of any process changes you’re making, new options available to them, and what to expect next. Customer support and marketing teams should work closely together to over-communicate any new processes and features, providing an easy and pleasant transition for customers.

Use the data you’re collecting. The ability to quickly access and analyze reports regarding DSO, late payments, and errors will help AR teams more efficiently manage the invoicing process and prioritize activities.

M E T R I C S F O R S U C C E S S

• DSO

• ADD (Average Days Delinquent)

• ART (Accounts receivable turnover ratio)

INVOICING FACTS & STATS

ARE SENT ELECTRONICALLY

TO ISSUER: 59%TO RECIPIENT: 64%

EXPECTED TOGROW TO 38% BY 2024

THE U.S. GENERATES 25BN INVOICES ANNUALLY

AVERAGE COST SAVINGS MOVING FROM PRINT TO ELECTRONIC:

AUTOMATION AND ELECTRONIC INVOICE COST SAVINGS:

30% $6/INVOICE38%

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ABOUT 30% OF OUR COLLECTIONS WAS STILL BASED ON PAPER CHECKS WHEN COVID-19 HIT.

THE AUTOMATED COMMUNICATIONS THAT YAYPAY’S PLATFORM PROVIDES ALLOWED US TO QUICKLY TRANSITION OUR CLIENTS TO ELECTRONIC INVOICING.”

HARRIS HWANG | CHIEF FINANCIAL OFFICER

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Watermark Insights empowers institutions with technology to engage administrators, faculty, and students with better data for learning. Our educational intelligence systems support a holistic approach to learning and development that enables colleges and universities to generate key insights and make strategic improvements at every level.

YAYPAY CASE STUDYWATERMARK

Harris HwangChief Financial Offi cer

C H A L L E N G EWatermark Insights was concerned about their ability to manage cash fl ow for liquidity while still being able to invest in growing the business. With outdated manual processes and limited visibility, they were struggling to build an accurate picture of their business health.

S O L U T I O NYayPay’s cloud-based, smart AR solution not only improved cash forecasting and gave Watermark Insights the visibility and accuracy they needed. When Covid-19 hit, it was critical in improving customer retention, through automation of ineffi cient AR processes.

R E S U LTWatermark Insights has been able to reduce their aging invoices bucket, mitigate risk, and still hit their business KPIs.

I N D U S T R YSaaS

Y A Y P A Y C U S T O M E R S I N C E2020

OUR BUSINESS IS CYCLICAL. THIS MEANS FORECASTING OUR PEAKS AND TROUGHS IS CRITICAL TO MANAGING CONSISTENT

BUSINESS HEALTH. HOWEVER WHEN COVID-19 HIT AND SOME OF OUR CLIENTS

WERE UNABLE TO PROJECT THEIR TUITION CASH FLOW, IT IMPACTED OUR ABILITY TO COLLECT PAYMENTS. SINCE

OUR FOCUS WAS ON CLIENT RETENTION, WE NEEDED A WAY TO GAUGE THEIR

HEALTH - AS WELL AS OUR OWN.”

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W W W . Y A Y P A Y . C O M

C H A L L E N G EWatermark Insights initially turned to YayPay for assistance with understanding their cash fl ow and gaining better predictability and accuracy in their forecasting. Their business goals are based on managing cash fl ow for liquidity while still being able to invest in growing the business. To achieve these goals, they needed greater transparency across their order to cash process, and they needed to ensure their data was accurate. Since many of their AR processes were still manual, and their ERP, CRM and accounting software wasn’t linked, this became a signifi cant struggle.

A secondary challenge arose when Covid-19 started impacting their client base. Payments were deferred, but clients did not always communicate this. As a result, the AR team spent time manually chasing each invoice, as every step in the collections process (15 days late, 30 days late, 60 days, etc.) was a manual one. This was ineffi cient and due to the siloed data sources, invoices would occasionally be issued late or were inaccurate, which negatively impacted the customer experience.

S O L U T I O NYayPay’s cloud-based, smart AR solution not only improved cash forecasting and gave Watermark Insights the visibility and accuracy they needed. When Covid-19 hit, it was critical in improving customer retention, through automation of ineffi cient AR processes.

Implementing YayPay provided Hwang with the data analysis he needed to run the business effi ciently, and even grow it, during diffi cult times.

YAYPAY GAVE US MORE PREDICTABLE FORECASTING, ALLOWING US TO

UNDERSTAND CASH FLOW FROM A BOTTOM-UP PERSPECTIVE. NOW WE

COULD SEE WHAT THE PAYMENT TRENDS WERE AND MANAGE OUR BUSINESS

ACCORDINGLY.”

A recent poll by YayPay indicated that 88% of businesses said minimizing customer churn was their highest priority since Covid-19 struck.

However, Watermark Insights’ disconnected systems and manual processes were not geared to achieve this and managing customers was labor intensive and time consuming.

Amanda Gray, Director of Revenue Operations for Watermark Insights, said, “Before YayPay, our data sources weren’t connected and we managed our AR processes through manual tools. When we implemented YayPay, our customer satisfaction scores shot up - all billing contact information is updated and shared across our systems, which minimizes late invoices and brings payments back into our business more quickly.”

Automating order to cash also brought signifi cant benefi ts. “About 30% of our collections was still based on paper checks when Covid-19 hit,” Hwang said. “The automated communications that YayPay’s platform provides allowed us to quickly transition our clients to electronic invoicing.”

The automation and optimization of the collections process also meant:

• Customized workfl ows for diff erent client cohorts.

• Workfl ows were customized by the type of language, the cadence, and tailored to team members in diff erent departments.

• Team members now spend more time working on the highest priority, escalated accounts.

R E S U LT SWatermark Insights has been able to:

• Improve ageing profi le of A/R by decreasing invoices that were 90+ days old, using accurate and effi cient payment reminders.

• Reduce the number of customers seeking delayed payment terms to a negligible amount.

• Increase collections, hitting their highest number to date at October end, through improved customer communications and coordinated eff orts.

Watermark Insights plans to expand their use of YayPay. They currently use YayPay’s online customer portal for communications and to deliver invoices to customers. In phase two, they plan to leverage the payments functionality to accept ACH and credit card payments. Once that is implemented, the payments process will also be automated, with all required data being delivered directly to the ERP.

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DISPUTE RESOLUTIONW H A T I S I T ?Dispute resolution is the process by which a conflict or counter-claim regarding an invoice is resolved. Invoices may be brought into dispute when a customer feels the amount due or payment terms are incorrect. The dispute happens at the time of invoicing, prior to any payment being made.

T H E I M P A C T O N T H E B U S I N E S SWhen an invoice or purchase order is in dispute, it puts the payment at risk. This impact the business’ ability to forecast cash flow. When disputes are not resolved quickly, it also costs the business in time, money and resources (AR team, legal or procurement team members) to sort through the discussion and come to terms with the customer. Customers who are navigating a dispute process may have a negative opinion of the business if they feel their claims are not handled fairly or with due diligence.

There are wide range of disputes, from a simple inquiry or question, possibly needing more supporting documentation / information, to a disagreement with the invoice (pricing, terms, quantity, damage, returns and much more). It is also common for the dispute to be simply around not receiving the invoice.

Disputes about invoices not only increase your days of sales outstanding, therefore impacting your cash flow and cost of capital, but will have a big impact on labor required to resolve the dispute as well as customer experience.

C O M M O N C H A L L E N G E SDispute resolution impacts multiple departments, and common issues are:

1. Data management. Customer data, order information and payment terms often reside in different systems, owned by different teams (eg. Sales, AR and Operations). Yet it is critical to access accurate information in a timely manner when working through a customer dispute. This lack of visibility and access causes frustration for both internal teams and customers.

2. Cost management. The lack of a single dashboard to view open invoices, recent payments, credits and DSO for customers adds to manual labor needed to process payments and support customers. Without tools that tie together data, customer support teams cannot easily identify where an error might have occurred, and if they can’t identify it, they cannot correct it. Time spent by customer support, AR and sales teams chasing down information costs the business money.

3. Customer Experience. Customers do not want to call multiple times to resolve an issue. Many do not want to call at all, but prefer email or chat. Inflexible communication channels and lack of accessible data results in a poor customer experience. If self-service channels for support are not available, customers spend time - and AR team’s time - chasing down simple things like copies of invoices or verifying a line item detail. All of this can have multiple impacts. It can cost your business a customer, create a negative reputation in the market place, hinder your ability to attract new customers and reduce your ability to accurately forecast and manage cash flow.

4. Communication. When data resides in different silos and there aren’t clear communications channels between sales, at the front of a transaction, and the AR team, on the backend, information and details get lost. A lack of fluid communication processes and transparency between teams results in frustration for both internal teams and for customers, who are not being served efficiently.

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B E S T P R A C T I C E SImplement a centralized system with access to dashboards. An online portal will accelerate the dispute and resolution process, and put some of the control back in the hands of your customers.

Communication tools. Take advantage of new communications channels to meet your customers where they are at. More customers prefer to interact with businesses via email and chat, rather than phone. And they still expect immediate responses. Explore opportunities to answer questions and handle disputes with the communication channel of your customer’s choice, and deliver a more efficient and highly rated customer experience.

M E T R I C S F O R S U C C E S S

• ART (Accounts receivable turnover ratio)

• Past due AR

DISPUTE FACTS & STATS

OF DISPUTES ARE INVALID

ON AVERAGE, MANAGING DISPUTES CONSUMES 30% OF THE CREDIT TO CASH PROCESS

ABOUT 5% OF ALL DISPUTES ARE WRITTEN OFF BY YEAR-END

OF BUSINESSES LEVERAGE AUTOMATION OR A RULES-BASED

PROCESS TO MANAGE DISPUTES

15%

45%LESS THAN

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COLLECTIONS MANAGEMENTW H A T I S I T ?When an invoice is past the agreed upon terms for a customer to make a payment, the collections process starts. For some organizations this might be done by a dedicated collections team, others they rely on receivables or billing teams to collect on overdue accounts.

AR aging reports lists unpaid customer invoices, a primary tool used by collections staff to determine which invoices are overdue for payment. The AR collection process is used to evaluate how long customers take to pay their invoices.

Collections management consists of a number of different activities:

• Collection Strategy & Workflow

• Customer Follow Up Cadence Request Routing and Processing

• Interdepartmental and Customer Collaboration & Escalation

• Reporting and Analytics

T H E I M P A C T O N T H E B U S I N E S SA CRF benchmark report shows that lower quartile organizations have 5% of sales overdue by more than 60 days. That would be $50,000 for every $1MM in revenue at risk of not being paid – a significant sum. The inability to efficiently manage collections has a direct impact on several areas of your business, in addition to revenue:

• Increased days sales outstanding (DSO)

• Increased bad debt

• Higher labor costs to reclaim cash

• Loss of customers due to poor experience

• Delayed or lost revenue and cash flow

C O M M O N C H A L L E N G E SThe Collection Effectiveness Index, also known as CEI, is a calculation of a company’s ability to retrieve their accounts receivable from customers. CRF Benchmark Report shows a significant gap between best in class organizations CEI or 91.92% (still room for improvement) and bottom quartile at 69.80% (lots of room for improvement).

1. Decrease in revenue: as receivables age, the ability to collect the full amount decreases. According to insideARM, organizations will only collect 20 to 60 percent of receivables once they are 90 to 120 days old.

2. Labor costs increase: the process of collections takes time and manpower. When you add the costs of collections to the reduced amount collected, the result is even higher losses for the business

3. Lack of defined process: when the collections process is not clearly defined or tracked, then collections teams lose the ability to accurately track communications and effectively help customers. There is often a separate team handling the delivery of invoices versus the collections efforts, which means sometimes data is lost, collaboration is difficult and the ability to forecast cash flow becomes nearly impossible.

DECREASED IN VALUE AS RECEIVABLES AGE

VA

LUE

AGE

100%

90%

80%

70%

60%

50%

40%

30%

20%

10%

0%<30 30-59 60-89 90-120

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B E S T P R A C T I C E SCollections management is key to a healthy cash flow. Investing to improve collections effectiveness is guaranteed ROI (return on investment) when managed with smart tools.

Centralized system: Access to data and a unified collections workflow will drive better communications and collaboration across the AR, collections and sales teams, as well as improve customer satisfaction.

Create process flexibility and clarity: Have clear and simple guidelines to help your teams manage the process both prior to and during collections. Offering your customers a variety of payment options and treating them like human beings, not just invoice numbers, will go a long way in mitigating risky circumstances before they impact the actual collections pipeline. Some steps to take include:

• Ensure payment and collections processes are in writing and available to customers

• Identify forms of payment accepted

• Payment options for customers struggling to pay the full amount due immediately (eg. Offering installment payments)

Eliminate repetitive processes: Look for solutions that can automate cadences and workflows for follow ups and dunning letters, track open rates, report on bounces and support internal and external notes eliminating duplicating efforts when multiple resources are interacting with the same customer.

Establish a smart communications plan: They key to collections is following up early, and regularly. There are many reasons a customer is late with payment - forgetfulness, a dispute, lack of funds, etc. With a frequent outreach process to help customers resolve their financial issues, you can improve customer relationships and positively impact cash flow.

Take advantage of predictive analytics: Applying analytics-based prioritization to focus on your best targets will maximize collection efficiency, as well as lower both risk and labor. Leveraging more sophisticated predictive analytics to detect customer behavior anomalies will give you advance insights on collections risk, allowing your team to act quickly to prevent loss and impact your customers credit rating.

M E T R I C S F O R S U C C E S S

• AR aging reports

• CEI (Collections Effectiveness Index)

• DSO

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COLLECTIONS FACTS & STATS

AVERAGE AMOUNT OF COLLECTIONS: $2400-3100

CHEMICAL PRODUCTS

NON-METALLIC MINERALS

LOWEST PERFORMING INDUSTRIES

HIGHEST PERFORMING INDUSTRIES

MISC MANUFACTURING FOOD PRODUCTS

BUSINESS SERVICES

FURNITURE & FIXTURES

27% 36%

AVERAGE CEI (ACROSS ALL INDUSTRIES)

OF BUSINESSES OUTSOURCE THEIR CREDIT AND COLLECTIONS MANAGEMENT

OF BUSINESSES HAVE 6-10% OF THEIR AR PAST DUE

OF BUSINESSES HAVE OVER 10% OF THEIR AR PAST DUE

83%6%

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PAYMENTSW H A T I S I T ?“Payment” is the fulfillment of the “receivable” in account receivables. It is the actual cash handover of what is owed to a business through the AR invoicing process. The payment is the end goal of the order-to-cash process.

T H E I M P A C T O N T H E B U S I N E S SToday, the majority of B2B payments are still made by check: Pymnts.com estimates that 64% of B2B payments are through paper check, even though this method of payment is quite costly for suppliers and buyers. Estimates for processing payments range from $9 to over $40 per check, and those costs are compounded when you consider circumstances such as misdirected mail or nonsufficient funds for payment. Factored into that cost is not just the pricing of printing and postage for the payment, but the labor to execute the payment, to resolve non-delivery or non-payment issues, and the cost of time for delivery.

Other forms of payment like ACH/EFT, wire and credit cards are typically faster to both receive payment and recognize the revenue, however they do take organization and investment on your business’ end to manage effectively.

Flexibility in payment options is critical, however, to ensuring:

• Reduction in DSO

• Customer satisfaction

• Cash flow

C O M M O N C H A L L E N G E S There are challenges in the payments process, whether you’re a company who only handles traditional payment methods such as checks and cash, or whether you have added a multi-channel payment strategy to your business.

1. Labor: the workforce and cost of managing paper checks is high, and variable. It requires human labor to process, which is a slower process for recording and recognizing revenue.

2. Cash flow: when payments are trapped in a paper trail, or if the electronic channels are not managed properly, cash flow is not easily forecast nor recognized.

3. Customer Experience: more B2B customers are looking for a B2C experience when it comes to payments. They are easily frustrated by limited payment channels and a lack of self-service options, which will send them looking at your competitors for a more seamless experience.

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VISIBILITY & TRACKING

SEAMLESS EXPERIENCE

B E S T P R A C T I C E SHaving a payments strategy is key to accelerating the payments process, reducing labor costs for the receiving/handling of payments, and increasing customer satisfaction, while lowering your DSO and overall costs. Key components of your payments strategy should include:

• Offer multi-channel payment options: allowing your customers the choice to pay via ACH/EFT, credit card, or wire, means your customers have more ways to get you money – and get it to you more quickly

• Accept automatic payments: if your business model supports it, consider implementing a program that automatically deducts payments from customer accounts, minimizing the need for labor costs for both you and your customer.

• Design customer-friendly incentives: offer incentives for early payments, or on-time payments, to drive a more predictable and higher cash flow. This can help you with a higher “paid on time” percentage metric, measuring the health of your cash flow.

• Consider offering payment plans: for customers struggling financially, a payment plan may be exactly what they need to keep their own business afloat and their accounts in good standing. It can also be structured in a way to be financially beneficial to the company, so cash continues to flow and friendly customer relations are preserved.

• Give your customers access to an online portal: allow them to make payments, make payment arrangements through various payment channels, and communicate with your team means doing business 24x7. Customers are more apt to respond quickly, and report a better customer experience when they are able to manage on their own time.

• Use your partners’ tools to improve your own processes: partner with payment processing tools that not only support your multi-channel payment options, but that also eliminate the burden of security and compliance from your IT teams. These tools also often provide the reporting and visibility needed to track payments, monitor late or short payments, and address issues quickly, providing for a positive customer experience and mitigating risk to the business.

M E T R I C S F O R S U C C E S S

• Average Days Delinquent

• Paid on time percentage

CHECK PAYMENTS ONLINE PAYMENTS

COSTLY COST EFFECTIVE/FAST

FLOAT DELAYS

NO VISIBILITY

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PAYMENTS FACTS & STATS

IN THE US,

26% OF ALL INVOICES GO DELINQUENT OR UNPAID

AVERAGE DAYS

DELINQUENT

INVOKING “PLEASE” AND “THANK YOU” INTO YOUR COMMUNICATIONS

INCREASES YOUR LIKELIHOOD TO GET PAID BY 5%

FIVE

FOOD PRODUCTS

CHEMICAL PRODUCTS

WORST PERFORMING INDUSTRIES

BEST PERFORMING INDUSTRIES

APPAREL LUMBER & WOOD

BUSINESS SERVICES

PRINTING & PUBLISHING

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THE TRUE COMPETITIVE EDGE THAT YAYPAY HAS, IS THE RELATIONSHIP THEY CREATE WITH THEIR CLIENTS.

MY TEAM FEELS HEARD, FEELS APPRECIATED, AND WE ARE ACTIVE PARTNERS WITH YAYPAY. THIS RESULTS IN SUCCESS FOR BOTH OF US.”

PETER ROLLER | DIRECTOR OF AR

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LogMeIn, Inc.’s category-defi ning products unlock the potential of the modern workforce by making it possible for millions of people and businesses around the globe to do their best work simply and securely—on any device, from any location and at any time. A pioneer in remote work technology and a driving force behind today’s work-from-anywhere movement, LogMeIn has become one of the world’s largest SaaS companies with tens of millions of active users, more than 3,500 global employees, over $1.3 billion in annual revenue and approximately 2 million customers worldwide who use its software as an essential part of their daily lives. The company is headquartered in Boston, Massachusetts with additional locations in North America, South America, Europe, Asia and Australia.

YAYPAY CASE STUDYLogMeIn

Peter RollerDirector of AR

C H A L L E N G ELogMeIn was looking for a collaborative partner who took their product feedback under consideration, and who off ered a strong integration with NetSuite.

S O L U T I O NYayPay’s smart AR platform off ers seamless integration with Netsuite, ensuring LogMeIn can take advantage of extended features and capabilities. The product and customer support team have worked with LogMeIn to ensure their needs and ideas are captured, and worked into the product roadmap.

R E S U LTDue to Covid, LogMeIn experienced a 26% growth in electronic invoicing. They have been able to manage this unexpected spike:

• without adding headcount

• still meeting all business KPIs

• reducing DSO by 1/2 a day

I N D U S T R YSaaS

Y A Y P A Y C U S T O M E R S I N C E2019

THE TRUE COMPETITIVE EDGE THAT YAYPAY HAS, IS THE RELATIONSHIP THEY CREATE WITH THEIR CLIENTS. MY TEAM

FEELS HEARD, FEELS APPRECIATED, AND WE ARE ACTIVE PARTNERS WITH YAYPAY.

THIS RESULTS IN SUCCESS FOR BOTH OF US.”

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W W W . Y A Y P A Y . C O M

T H E C H A L L E N G ELogMeIn was looking for a new partner to help them seamlessly handle a consistently growing invoice count and integrate with NetSuite. Their current partner had a static solution with no new releases or updates, and the team at LogMeIn wasn’t even sure whom to contact when they had questions or needed support.

“WE WERE LOOKING FOR A NEW PARTNER WHO NOT ONLY HAD A TIGHT

INTEGRATION WITH NETSUITE, BUT WHO WE COULD ESTABLISH A TRUE

PARTNERSHIP WITH,” SAID PETER ROLLER, DIRECTOR OF AR FOR LOGMEIN.

“WE ARE FORTUNATE WE STARTED THE SEARCH FOR AN IDEAL PARTNER

WHEN WE DID - WE HAD NO IDEA THAT COVID-19 WAS COMING AND HOW THAT

WOULD AFFECT OUR BUSINESS.”

The added challenge that Covid-19 brought was the shift many businesses had to make to handling all invoicing electronically. From 2019 to 2020, LogMeIn experienced a 26% increase in the number of invoices they are handling monthly.

T H E S O L U T I O NThe LogMeIn team decided to partner with YayPay to manage their credit-to-cash process based on several factors:

• YayPay has a commitment to continuous improvement, so there have been frequent updates and releases to add value to the product on a regular basis

• YayPay has a seamless integration with NetSuite, creating a more powerful solution for managing AR

• The YayPay product team was open about sharing the product roadmap and receiving ideas and feedback from LogMeIn about how their needs could be better met

• The user interface and customer portal were far friendlier and easier to use than the Salesforce.com interface they had been working with prior

• The customer support team at YayPay is highly responsive

T H E R E S U LT SSince fully implementing and integrating YayPay with NetSuite in late 2019, the LogMeIn team has enjoyed working with a partner who includes them in product discussions and is responsive to their questions.

In addition, they’ve seen the following results:

• A 26% increase in monthly invoice volume when Covid-19 hit has been managed fl awlessly with no additional headcount

• Despite increased volume and fl at headcount, DSO was reduced by ½ day

• Cash forecast has been beat every month in 2020

“WE WERE ABLE TO SCALE RAPIDLY WHEN THE UNEXPECTED HIT,” ROLLER

SAID. “AND WE DID SO WITHOUT INCREASING OUR OPERATIONAL

EXPENSES AND WHILE STILL HITTING ALL OUR KPIS. THIS HAS BEEN SIGNIFICANT

IN SUPPORTING OUR BUSINESS IN 2020.”

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DEDUCTION MANAGEMENTW H A T I S I T ?Deduction management is the process through which you manage invoice payment and processing when a customer short pays an invoice. The customer may take the “deduction” resulting in a short pay for a variety of reasons, including erroneous charges, packaging errors, incorrect shipping methods, discounts taken out of term, or tax exemptions. The AR team needs a process to follow to reconcile the difference.

T H E I M P A C T O N T H E B U S I N E S SDeductions impact your revenue. When customers are only partially paying bills, it can be challenging to forecast revenue, which drives your ability to grow your business, reinvest, and in some situations, pay your bills.

A deduction can be difficult to resolve because the customer takes the deduction based on their own policy and procedures, and it is up to you to prove whether the deduction is merited.

According to the Credit Research Foundation’s (CRF) Benchmarking Report, on average, a single deduction costs a company approximately $97 to process, research, validate, dispute and clear. Spending resource time on deductions that are under $100 often costs a company more than the deduction is actually worth.

Various industry studies indicate that 5% to 15% of all invoices are affected by deductions.

This means, using CRF’s data, if your company’s revenue was $100 million, you would have $10 million (averaged) in deductions. Of that amount, 85% or $8.5 million, would be permitted and $1.5 million would be considered unauthorized. Significant staff time is required to investigate the claims and bill back that $1.5M differences to customers.

In addition to the time spent by your own AR team, customers are frustrated by incorrect invoices and the time it takes their own teams to handle the negotiations. A poor deductions management process can severely impact customer satisfaction.

C O M M O N C H A L L E N G E S Deductions are a challenging aspect of AR. Some common themes include:

• Internal errors in billing policy or pricing, usually due to manual processes or data not being updated across company systems, often lead to incorrect invoices being sent to customers.

• Lack of documented policy leads to misunderstandings and assumptions for both your internal AR teams and your customers.

• Unclear or manual processes for issuing updated invoices or chargebacks leads to further delays and frustrations.

• Some customers take deductions for any “infraction” of their terms and conditions or routing guides that are included on their purchase orders

• The responsibility for identifying, validating, and controlling the problem is shouldered by areas within the organization that generally have neither the resources (information) nor authority to make changes or final decisions.

• Buyers sometimes take a deduction then set a time frame for working out the difference and claiming the money. A buyer may say that you only have 60 days to resolve the issue and collect the funds, but if you aren’t able to resolve it, and the 60 days elapse, you are out of luck. And funds.

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B E S T P R A C T I C E SCreate an integrated team to manage the process: Effective deduction departments have close touch points with sales, finance, logistics, accounts payable, and customer service teams. This enables transparency in communication so deductions teams can quickly get the approvals needed to write off or chargeback disputes, and can also push out cross-functional analysis based on high dollar or volume reasons for deductions.

Be willing to look at the big picture: Many organizations simply jump into reaction mode with deductions rather than viewing them as a warning sign that something within the operation is wrong. Take the opportunity to evaluate how your deductions management process works - or doesn’t - and adjust as needed. This will reduce the costs to your business in both resources and missed revenue.

Leverage smarter payment options: EFT (Electronic Funds Transfer) allows you to audit payments as they are received from the customer to identify problems that are noted on the checks as deductions. The transmissions usually classify deductions by type and amount, and a smart AR software solution can then apply the deductions and cash automatically by using this electronic data.

M E T R I C S F O R S U C C E S S

• CEI (Collection Effectiveness Index)

• Deduction turnover per AR/Deductions specialist

• Revenue forecast accuracy

DEDUCTIONS FACTS & STATS

AVERAGE TIME TO RESOLVE A DEDUCTION:

MEDIAN DAYS DEDUCTION OUTSTANDING (DDO): 44

INVALID DEDUCTIONS (AVERAGE): 7.5%

INVALID DEDUCTIONS RECOVERED: 60%

90 DAYS

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CASH APPLICATIONW H A T I S I T ?Cash application is the process of applying incoming payments to the correct customer accounts and receivable invoices. Determine where to apply the payments by matching the payment to the associated invoice(s).

T H E I M P A C T O N T H E B U S I N E S SThe result an inefficient cash application process:

• Delayed and inaccurate payments due to human error

• Reduced cash flow due to time needed to manually key in data and process payments

• Time wasted on labor intensive research to manage disputes, deductions or shortpays, and correct errors

• Customer unhappiness when payments are misapplied and take time to correct, impacting their credit rating

• Inability to accurately reconcile accounts and predict cash flow

C O M M O N C H A L L E N G E S While there are a number of payment methods your customer might use to send funds (as discussed in the Payments section), there are only two types of cash flows to the business:

• Customer-initiated: payment generated and sent by your customer such as check, EFT/ACH, wire, etc.

• Supplier-enabled: pre-authorized agreements or payments via a customer portal

Customer-initiated payments breakdown further by category: electronic (EFT/ACH or wires) and paper-based checks. Both categories require staff to handle remittance details and enter data into the ERP system to correctly post payment information against the appropriate invoices. In addition:

• This process can be quite laborious, as a single payment could be applied against multiple invoices.

• Customer-initiated payments might be missing important data elements or invoice might be short paid without explanation, making it difficult to accurately apply funds

• Since your team is working with static remittance documents (check stub or eRemittance) gathering additional data to ensure the accuracy of a transaction is manual and time consuming

• Paper based payments not only delay timing of receipt (mail float), but are difficult to collaborate with others (its paper after all) and no contact information to reach out to payees for any questions

• eRemittances are easier to share and collaborate, however they do have tendencies to get lost (ie. spam folders) and are sent from a generic AP email addresses, typically lacking contact information

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B E S T P R A C T I C E SAccording to NACHA, 97% of businesses still make B2B payments by paper check. This means there is a big opportunity to implement new methods to improve the customer experience while reducing costs, errors and labor associated with cash application. This improves the speed of payment and the health of your business.

Create an online customer portal: Integrate invoicing, collections, communications and customer support, allowing customers to self-serve as well as connect with your teams as needed. This portal not only provides a better customer experience, ensuring you are competitive in the market and connected with your customers, but also ensures:

• reduction in errors

• visibility and transparency inside the customer accounts

• improved customer communications

• increase in on-time payments

• eliminate “naked payments” (payments made without remittance data)

Deploy automated processes: Leverage automation tools to accurately match invoices to payments, support the dispute and collections process, and feed cash application data back to your ERP system. A robust cash application system can prioritize emails, capture and translate information via AI, and use machine learning to automate postings. Automating the cash application process helps to:

• accelerate the time to recognize revenue

• minimize human error and misapplied cash

• ensure risk management and PCI compliance

• significantly decrease labor required to manually match payments and key in data

• improve customer experience

• reduce DSO

M E T R I C S F O R S U C C E S S

• DSO

• Through-put or checks processed per day

• Transaction turnover per cash applicator

• Deduction turnover per cash applicator

CASH APPLICATION FACTS & STATSOF COMPANIES USE THEIR ERP FOR CASH APPLICATION

OF COMPANIES ACHIEVE STRAIGHT-THROUGH PROCESSING OF OVER 90%

ARE ACHIEVING STP RATES OVER 80%

OF BUSINESSES MONITOR UNAPPLIED CASH

MONITOR THEIR CASH APPLICATION HIT RATE

73%17%24%42%23%

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CREDIT TO CASH 2020: YAYPAYW H A T I S I T ?Modern times call for modern solutions. The technology is out there. We can build it.

And we have.

YayPay is a one platform, one system, one code base solution for AR teams at mid-sized enterprises. Our cloud-based solution leverages machine learning and automatic payment communications to accelerate collections, eliminate and streamline the manual effort associated with following up on late invoices, and report on KPIs. YayPay integrates with multiple accounting, ERP, billing, and CRM applications, for a complete look into the AR process, from credit to cash application.

YayPay is focused on developing smart tools for smart AR to help organizations improve productivity, predict cash flow and increase revenue.

This is the secret weapon of the Revenue Hero.

Y A Y P A Y ’ S I M P A C T O N T H E B U S I N E S SWhat does a single, simplified view into your entire AR process really mean for your business? It means your Revenue Hero status goes unquestioned. YayPay’s smart platform brings you productivity, predictability and transparency to run a more efficient - and more profitable - business.

Today, only 5% of businesses have fully automated their credit to collections process (FIS Survey). The opportunity for improvement is huge. With YayPay,’s platform, you outsmart the pack by using a smarter tool for smart AR.

Productivity - Improve human efficiency 3X with automated processes for smarter use of resources

• Reduction of manual processes, which in turn decreases overhead and improves margins.

• Prioritization of tasks for AR teams based on the dollars at risk allow them to focus on activities that will accelerate payment.

• Easy product set-up and on-boarding capability speeds time to implementation and use of automated tools for maximum benefit.

• Robust developer toolkit (API), built for developers by developers, to enable easy integrations and faster time to market.

• Online portal access for customers allows for self-service, which reduces time with customer service reps, decreases operating costs and enhances customer service.

Predictability: Smarter business decisions through accurate forecasting of revenue and cash flow

• Accurate accounts receivable balance by pulling open AR invoices managed within ERP or billing application

• Comprehensive dashboard and statement reporting to support internal or external audit and management reporting requirements

• Ability to implement centralized AR collections policy management across multiple business entities and / or applications

• End-to-end AR collection automation solution mitigates risk to cash flow and improves financial governance across the organization

• Assessment and control of corporate credit risk.

Transparency: Visibility across all your AR applications for smarter business understanding and communications.

• Access to multiple data sources for the most complete picture of your customers’ accounts

• 24/7/365 self-service customer access to online portal for invoice review, account management and payment

• Robust, automated communications program enabling stronger customer relationships and smarter account management

• Clear management dashboards, contextual information and intuitive user interface eliminate the data silos, and enhance the ability to easily understand account status and take appropriate action.

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K E Y F E A T U R E S O F Y A Y P A Y

• Smart Automation: Minimize time spent on manual credit, collection, dispute, and cash application activities. Increase productivity with automated work queues for collectors, resolvers & cash appliers.

• AR Email Automation: Automation of all collection-based email activity. Customers no longer need to use individual email accounts anymore to send collection notices; all collection communications can be managed out of an automated email account within YayPay. Emails responses are tracked (viewed, error, sent) and made visible within YayPay to determine whether or not the communications are being opened and read by the vendor. YayPay can determine the effectiveness of electronic communication based on the frequency and the dunning message that is being sent (open rates, turnover on the AP staff, etc.).

• Collection Workflows: Collection workflows which automates cross team and customer invoice communications and reduces the human element from the collection process. The Collection Workflow also builds the Collector ‘to do’ lists which ensures automation of creating the daily collector task

• Real-time, dynamic AR aging report: Dynamic aging report continually updated from the source ERP and/or billing system, based on a standard integration or a custom-built API. All outstanding invoice data and payment history is automatically up to date and gives the finance and collections teams a unified 360-degree view

• Customer Portal: Online 24/7/365 access allows for self-service, which reduces time with customer service reps, decreases operating costs and enhances customer service.

• Allows customers to download duplicate invoices and proof-of-delivery data.

• Facilitates communication and expedites processing of disputes.

• Improves efficiency with centralized repository of data (notes, disputes, payments, open/closed invoices).

• Communications Hub: Centralized customer correspondence allows for the finance team to be more efficient with their time on the collections process while simultaneously empowering their sales team by automatically alerting them to follow-up on their accounts as needed.

• All customer correspondence is stored and maintained in perpetuity inside YayPay (notes, calls, emails, disputes). All invoice, communication (notes, emails, tasks) and sales and billing contact details are all under one umbrella.

• Payment Behavior Analysis: Tools to monitor customer internal credit scoring designations, based on past payment performance. This allows for companies using YayPay to identify trends in customers’ behaviors which may indicate a

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need to dedicate more Collector time and attention to accounts falling behind on payments. This provides the business another tool to potentially determine the appropriate credit terms to extend to a business.

• Payment predictability: Machine learning enables the finance team to reliably predict vendor payments. This provides the finance team tools to identify collection actions and accounts to be spending their time on thereby providing visibility into the future payment/cash flow (lifeblood) of the business.

• Smart Payments: Apply payments to open receivables through the customer statement view of open invoices (via the portal) thereby allowing their customers a fast, inexpensive and efficient way to pay the open receivable balances via credit card or ACH. They pay their way and when convenient for them.

• Smart credit decisions: Assessment and control of corporate credit risk.

• Dynamically adjust collection practices based on corporate credit risk.

• Improve credit decisions with custom credit scoring.

• Ensure compliance with policy and regulations

• Smart collections policy: Centralized administration to implement collection policies across the business to accurately and with predictability standardize the cash collection process across all channels, business units and applications.

• Real-time AR Collection Analytics: Comprehensive library of common AR and collection dashboards which summarize and display historical trends (DSO, APT, Cash Collected, Current and Overdue invoices, Open Invoices, Email Reminders, Cash Collected) and a predictive future for cash collections across the business

• AR Accountability: Acceleration and accountability in the collections process. The Finance team can leverage the native YayPay Collection Workflows to fill up the Collector’s daily ‘to do list’ which sets the days collection activity. The AR Metrics dashboard tracks the Collector KPI (Amount Collected, emails sent, disputes opened, disputes closed, promise to pay #, tasks opened and tasks closed) over a specified time horizon. These tools gamify the collection process turning each collection win into a ‘celebration’.

• Seamlessly integrated finance systems: Eliminate data silos and enjoy access to multiple data sources for the most complete picture of your customers’ accounts with YayPay’s Modern REST API

• Pre-built, certified integrations with the most commonly-used business applications such as ERP, Billing and CRM applications

• The teams will have a unified view of customer aging, statements, payments, customer notes, disputes, and emails

• Well-documented developer toolkit (API), built for developers by developers, for seamless integration with custom programs

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WE HAVE SEEN PAYMENTS COME IN FASTER, AND A BETTER CUSTOMER EXPERIENCE BECAUSE WE ARE ABLE

TO ADDRESS THINGS QUICKLY.”

CHRIS PEARCE, INTERNATIONAL FINANCE DIRECTOR, CHEETAH DIGITAL

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YOUR COMPANY THE YAYPAY SOLUTION YOUR CUSTOMER

YOUR ERP

YOUR BANKYOU YOUR CUSTOMERS

YOUR YAYPAY PORTAL CARD & ACH PROCESSOR YOUR CUSTOMER’S PORTAL

THE YAYPAY ENGINE

CC GATEWAYACH

AR DATA INVOICES

PAYMENT RECONCILIATION FILES PAYMENTS

Y A Y P A Y : A N I N T E G R A T E D S O L U T I O N

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Y A Y P A Y - C R E D I T 2 C A S H 32

TERMS TO KNOW• Credit worthiness: the extent to which a person or company is considered suitable to receive financial credit, often

based on their reliability in paying money back in the past. This information is gathered from information provided by the person or company applying for credit, as well as by third party companies that collect such data.

• Risk assessment: the overall process or method where you identify hazards and risk factors for a project or outcome. The risk assessment process is applied when evaluating a person or business’ credit worthiness.

• Bad debt: a debt that cannot be recovered. This becomes a write-off as a loss for the business.

• Predictive analytics: the practice of extracting information from existing data sets in order to determine patterns and predict future outcomes and trends. When applied to a person or business’ past payments and credit behavior, it aids the risk assessment process by providing insight into whether the entity has a reliable pattern of making payments or not.

• Days Sales Outstanding DSO: the average number of days that receivables remain outstanding before they are collected. It is used to determine the effectiveness of a company’s credit and collection efforts in allowing credit to customers, as well as its ability to collect from them.

• Purchase Order: a commercial document issued by a buyer to a seller indicating types, quantities, and agreed prices for products or services. It is used to control the purchasing of products and services from external suppliers.

• Remit or Remittance: a statement that accompanies a payment to a supplier, detailing what was paid. The supplier uses the information on a remittance advice to flag outstanding receivables in its accounting system as having been paid. A remittance advice is frequently printed as an attachment to a check payment.

• Dispute: when the customer disagrees with the invoice amount, or other details on the invoice, it puts the amount due in jeopardy. Customers do not pay when an invoice is in dispute until it is resolved by both parties (customer and supplier).

• Average Days Delinquent: average day’s invoices are past due, the amount of time between invoice due date and the date it is paid.

• Account Receivables Turnover Ratio (ART): The ART measures how many times your company turns accounts receivable into cash during a period; usually over one year. A higher ratio means you are turning A/R into cash more frequently; if, for example, your ration is 2, you collect average A/R twice a year, every 6 months

• Collections: Collections is the process of pursuing payments of debts owed by individuals or businesses.

• AR Aging Report: record that shows the unpaid invoice balances along with the duration for which they’ve been outstanding.