Consumer products companies are facing a plethora of challenges when it comes to the management of the order to cash process. Such challenges include the ability to effectively manage high order volumes and dealing with high levels of deductions.
The Business Problem
The client is a global leader in the Consumer Packaged Goods (CPG) industry and manufactures a wide range of products in beauty and household care units. However, their expanding operations, which were now spread across over 15 countries, and huge transaction volumes were creating challenges in their order to cash process. The diverse consumer base and seasonal fluctuations were further adding to the woes and compelling them to leverage the expertise of SpendEdge’s team for a solution. The key objectives they were looking to achieve through this engagement were:
- Reduce order submission delays.
- Increase business productivity.
- Improve cash flow to initiate faster payments.
Improving the order to cash process can increase cash flows for organizations. Request a free proposal and access our complete portfolio of procurement market intelligence solutions.Request Free Proposal
Solutions Offered and Client Journey
The experts at SpendEdge realized that an effective order to cash process is crucial for the client to reduce inefficiencies in business operations. Therefore, they conducted a complete analysis of company processes to glean valuable intel and figure out delays in the order to cash process to improve the cash flow.
SpendEdge’s solutions helped the client to prepare a detailed implementation plan with well-defined timelines and responsibilities. Based on the insights gained, the experts at SpendEdge recommended the introduction of performance monitoring metrics for logistics scheduling and reporting services. The improvised order to cash cycle further enabled the client to invest their resources from transactional roles to more strategic ones and improve compliance.
Key Findings and Outcome
Minimized Order Submission Delays
The improved order to cash process helped the client to better understand their performance level in comparison to defined service level agreements and increase adherence by over 95% for shipment scheduling. This helped the client to minimize order submission delays substantially, get paid faster, and improve the cash flow.
The solutions offered helped the client to address customer disputes caused by order, delivery, or billing inaccuracies. Furthermore, the improved order to cash process helped increase their operational efficiency and market success. For detailed insights on the complete list of solutions delivered, request for more information.
What are the Order to Cash Best Practices?
Improve Order Management Process
Issues such as customers receiving wrong orders, order delays, and lack of inventory information resulting in backorders can create a major problem for companies. Streamlining the order management process will also help companies to eliminate inefficiencies while upholding a personal touch with customers.
Having an effective credit management system helps companies to ensure consistency in billing. It will not only minimize late payments but will help companies to improve cash flows by collecting outstanding payments.
Reduce Day Sales Outstanding
Day sales outstanding is the time required by organizations to receive payments. It is the average collection periods for accounts receivable. The better a company manages its invoices, the more it will be able to reduce billing time and day sales outstanding.