Accounts Receivable Management for Manufacturing

Manufacturing products in large quantities has plenty of challenges. Between the ever-changing market and keeping up with customer demands, manufacturers need to be flexible and able to produce new, exciting products to remain competitive. To be flexible, businesses need to operate efficiently and have the cash flow to continuously adapt to changes.


Maintaining cash flow is essential for manufacturers.


If you are creating new products, you need the capital to begin production. If you’re behind on accounts receivable management, you’ll quickly fall behind the competition.

The Importance of A/R Management in Manufacturing


Manufacturing is a cutthroat industry. There are always changes that need to be made to make your business more efficient and competitive in the marketplace. When your customers pay on time, it increases your cash flow and makes your business more agile in a changing marketplace.


Accounts receivable for manufacturers isn’t as simple as producing an item and sending an invoice, especially when dealing with large quantities. There’s countless data and steps manufacturers must complete. Each step of the process adds more time and more opportunities for error.


Once you send the invoice, the money you invested into making your product is in limbo until the customer pays. The longer customers wait, the less cash you have with which to work. Getting customers to pay in a timely manner enables manufacturers and wholesale distributors to keep up with the extremely competitive market.


How to Improve Accounts Receivable in Manufacturing

The best way to improve cash flow and efficiency for manufacturing businesses is with automated accounts receivable software. Using accounts receivable automation can lessen the time and effort required for manual data entry and speed up the collections process.


Automating A/R collections processes can provide your company with a host of cost and time-saving benefits:


  • Increase efficiency – Manually entering all the necessary data for accounts receivable takes immense amounts of time. A/R management software automates many of the time-consuming processes, increasing your overall business efficiency. You can even manage your accounts receivable with a smaller team, helping reduce labor costs.
  • Organize and manage invoices – A/R management software keeps all your invoices organized and easily accessible. It can track customer communications, including emails and calls, so you can see the history of each invoice, who has been contacted for payment, and who hasn’t. Not only does this keep your entire team on the same page, but it also provides a communication log you can use in case of a dispute.
  • Reduce days sales outstanding (DSO) – When customers pay on-time, you’ll have more cash on hand. Automated A/R collections process will help your collections team stay on top of payments, and can even automate some of the collections processes to drastically reduce your DSO. With more cash in your pocket, you can boost your savings or allocate money to other projects.


If your manufacturing business is struggling to maintain cash flow and keep up with manual data entry, automated software is the best way to improve accounts receivable. You can automate many of the time-consuming processes to increase efficiency, reduce errors, and decrease DSO for better cash flow.


With more money available, you’ll be able to adapt quickly to the changing manufacturing market, making your business more industry-competitive.

Automate AR Processes with Gaviti

To optimize accounts receivable processes, you need an automated A/R platform that can simplify the process to put more cash in your pocket. Gaviti automated software can move your A/R processes to a centralized automated system, making it easy to manage invoices, communications, and accounting processes.


With Gaviti, you can receive payments faster with less effort for better cash flow and business efficiency. Gaviti AR software can improve manufacturing DSO as much as 30%.


If you’re ready to see what automated AR software can do for your manufacturing business, contact the experts at Gaviti for a free demo and supercharge your collections today.


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