A debtor is a person or organisation that still has a payment obligation to another. Usually in the form of an outstanding invoice. This can range from individuals who owe money to shops to companies that need to make payments to suppliers. Debtors are an essential part of a company’s financial activities.
Accounts receivable management
Managing outstanding payments is known as debtor management. Having effective accounts receivable management offers numerous benefits to a business. For instance, it allows companies to optimise cash flow, reduce risks and strengthen relationships with customers. By managing accounts receivable, companies can also improve their liquidity and maintain financial stability.
The importance of good debtor management
Good accounts receivable management is important for the survival and growth of a business. It enables companies to receive timely payments, which promotes the company’s financial health. Moreover, it minimises risks of non-payment and loss of revenue, strengthening the company’s overall stability.
How do I ensure good management?
To ensure good debtor management, adopting a structured approach is important. This should include establishing clear payment terms, proactive follow-up of outstanding invoices, implementing efficient invoicing processes and using automated tools for invoicing and reminders.
How does TriFact365 help with debtor management?
TriFact365 offers a cloud solution that helps companies streamline their financial processes. With features such as automated invoice processing and real-time insights into outstanding items, TriFact365 helps companies make their accounts receivable management more efficient and effective. This helps optimise cash flow and improve financial health.