Accounts Receivable Outsourcing Services as a Strategic Partner

Thinking about hiring accounts receivable outsourcing services for your business? But why are you taking this route—for lack of internal expertise, unmanageable workloads, or potential cost savings? 

These are all good reasons, no doubt! 

But on top of these, you also need to consider: would this be merely delegating tasks, or are you aiming to establish a strategic partnership with your service provider? Because the two approaches differ significantly in purpose, goals, and expectations. 

Let’s explore more! 

AR Outsourcing: Delegation vs. Strategic Partnership

Outsourcing accounts receivable (AR) may appear to be a straightforward task handover to an external service provider. However, the reality is more nuanced! The level of involvement and commitment varies based on your business needs and goals. 

Delegation Only: You are entrusting your accounting services provider with specific tasks or processes and expecting efficient delivery— that’s all! It’s usually tactical and transactional, suitable for short-term projects or ongoing processes.

Let’s take an example. Your company outsources invoice processing but keeps other accounts receivable processes in-house. Or you hire tax preparation services, particularly at year-end. 

Importantly, whether you delegate to an in-house team or an outsourced provider, you need to trust them and relinquish some control. However, it takes a lot more to build a strategic partnership with the outsourcing company — from both sides! 

Strategic Partnership: Strategic alliances are a bit more layered and go far beyond just the delegation of tasks. Unlike a procurer-supplier relationship, they are more holistic and collaborative in nature and scope. Your outsourcing service provider functions like an extension of your team, working together on AR strategy and contributing to your overall success. These associations can continue for years! 

You might, for instance, outsource your AR function end-to-end, collaborating with the service provider on strategies for improving collection rates, optimizing workflows, or leveraging technology. 

How Accounts Receivable Outsourcing Services Become Strategic Partner 

Developing a collaborative AR outsourcing partnership significantly enhances your business’s efficiency and growth!

Here are key steps for forging a successful alliance in a dynamic yet tangible way: 

For Businesses Outsourcing Their Accounts Receivable 

1. Identify Your Needs & Goals: Pinpoint specific areas for improvement, such as collection rates and workflow efficiency, and define your long-term AR objectives at the outset of your outsourcing relationship. 

2. Seek a Partner, Not Just a Vendor: Find an AR services provider with relevant industry expertise and a track record of building strategic partnerships. 

3. Share Vision & Open Communication: Clearly communicate your accounts receivable process goals and expectations to your service provider and work closely with them to brainstorm strategy.  

4. Seamless Onboarding & Assimilation: Provide thorough training on your existing processes and company culture to ensure smooth integration. 

5. Give Timely Feedback: Maintain regular communication, share performance metrics, and work together to identify improvement opportunities. 

For Outsourced Accounts Receivable Services

1. Understanding Client’s Business: A professional service provider will spend adequate time deeply understanding its client’s industry, challenges, and long-term vision. 

2. Client-Centricity: Leverage industry knowledge and expertise to provide customized solutions that address the client’s specific needs. Fair pricing and scalability also seal the deal. 

3. Transparent, Proactive Communication: Open communication, regular updates, and timely escalation of any issues help service providers earn their client’s trust. 

4. Technology & People: A reputable service provider will hire only competent and well-trained talent and maintain robust data security for accurate and secure task delivery. 

5. Align for Shared Success: A strategic service partner will align its goals with its client’s success and show genuine interest in their growth. 

Such a spirit of collaboration, in both letter and word, allows businesses and accounts receivable services to forge win-win strategic partnerships that unlock new levels of efficiency and success for both.

When Tactics & Strategy Converge While Outsourcing Accounts Receivable Services  

When outsourcing AR, tactical and strategic goals might overlap. This applies to both full outsourcing and hybrid models, where internal and external teams collaborate. This allows you to capitalize on the strengths of both your in-house capabilities and the specialized expertise of outsourced services.

Sounds great, right? 

Here’re four examples how how these goals can overlap.

1. Collection Strategies

Your tactical goal is to delegate overdue account collections to your service provider. However, your service partner can also conduct a thorough strategic assessment to identify root causes of delinquencies and suggest changes to invoicing procedures or communication strategies (strategic), all while efficiently managing current overdue accounts (tactical). 

2. Data Analysis

Outsourcing data entry for AR reports could be a tactical requirement for your company. However, your outsourcing service provider could strategically examine the data, identifying trends or areas for improvement in your AR processes, which enhances decision-making (strategic), while ensuring accurate data entry (tactical). 

3. Risk Management

Outsourcing your credit risk assessment serves as a risk mitigation tactic for your business. Your AR services could also run historical data and market trends analysis to refine credit policies and minimize overall credit risk exposure (strategic), all while ensuring prompt and precise evaluation of individual credit applications (tactical). 

4. Technology Deployment

Planning to implement a new AR automation tool? Your outsourced services partner could strategically assess your receivable and collections workflows and recommend optimizations for the new tool, maximizing its efficiency impact (strategic), while ensuring a smooth implementation process (tactical). 

These examples illustrate how tactical delegation combined with strategic collaboration transforms your accounts receivable services provider into a valuable ally.

How a Business Benefits from a Strategic AR Outsourcing Partnership

Your strategic accounts receivable outsourcing services partner offers you many more advantages than transactional delegation. They help you push the boundaries of improving your business’s bottom line and efficiency, unleashing more value and ROI.

Let’s delve into some key benefits:

1. Access to Best Accounting Practices  

A strategic AR partner can help you with strategies to accelerate your trade receivables. They can help eliminate process inefficiencies, ensure effective tracking of pending payments, and apply best practices to deal with your customers. Therefore, you are able to reduce your DSO and speed up cash conversion, enhancing your business’s overall financial health.

2. Mitigate Bad Trade Credit Risk

An expert AR partner can analyse your aged receivables and identify customers (debtors) with a poor track record. This allows you to pursue overdues and launch collection efforts on time, protecting your business from financial loss. Some service providers also provide collections and dispute resolution services, markedly. 

3. Worry Less! Focus on Your Core Business  

Strategic handover thrives on solid trust in your service provider’s capabilities. The biggest benefit of doing this is that you gain the freedom to invest your internal resources in core business areas.

This one clever move allows your team to spend more on market research, product innovations, customer outreach, and revenue growth.

4. Seamless and Stable AP Processes

Strategic partnerships are usually long-term. Your strategic AR service provider has a deep understanding of your company’s culture, goals, strengths, and challenges. As such, they are better equipped to solve your accounting process issues and improve receivable performance. They continue to be by your side, driving seamless workflows and growth. 

Tailored Accounts Receivable Outsourcing Services from Centelli

Our accounts receivable outsourcing services are here to make your processes smoother. Our experts handle everything with care, helping you keep your books in order and maintain a laser focus on your cash flow.

Plus, you’ll save time and reduce operational expenses (up to 65%; T&C apply) along the way. We

• Beespoke Solutions: Tailored to meet the unique needs of businesses across various industries
• Accurate & Timely Invoicing: Ensures customers receive clear and detailed invoices promptly
• Efficient Collections: Ensure robust receivable collections through accurate invoicing, proactive follow-ups, and timely reconciliations
• Detailed Reporting & Analytics: Provides valuable insights into accounts receivable performance, enabling informed decision-making and operational optimization
• De-Risk Trade Credits: Mitigate your trade credit risks with our impeccable record-to-report processes, supporting thorough analysis

Looking for a reliable accounts receivable services partner who can meet your tactical or strategic business accounting needs efficiently and effectively? Think Centelli! Get in touch to discuss your requirement or book your free consultation right away!

Closing Note on Strategic Partnership in AR Outsourcing 

Clear deliverables, expectations, timely communication, and reporting are foundational to effectively delegating AR tasks to outsourcing services. Tactical delegation works like a vendor-client relationship.

In contrast, a high-value strategic outsourcing partnership emerges from deeper engagement and collaboration. It requires shared core values and established criteria for mutual benefit, risk management, and meaningful outcomes.

So, both parties must go the extra mile with realistic goals, ROI considerations, and mutual expectations. 

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