Getting cash and orders might make you feel as though your business is running smoothly, but many mishaps can occur between receiving an order and getting paid. Let’s look at the order-to-cash process, analyze how it works, and discuss why it is important to streamline.
The order-to-cash (O2C) process includes a client’s placing an order, the steps needed to fulfill the order, and finally your receipt of payment for the order. The process can be simple or complex, depending on the kind of industry you work in. For instance, if you are a software developer, the process is longer than if you worked in a brick-and-mortar store. O2C includes receiving orders, settling inventory, assembling and verifying the goods, dispatching orders, delivering them, receiving payment, and final reporting.
Why Should You Care?
Long lead times between order placement and delivery were commonplace just until a few years ago, but this time frame is no longer the case. Whether your business is publishing, software development, or retail, your customers want quick gratification.
From a business perspective, the sooner you are paid, the better. In other words, money that is unpaid or tied up in inventory causes delayed returns on investment (ROI). Although individually they might not amount to much, a few delayed receipts can total a substantial amount of money, especially when you handle large volumes of orders. Therefore, when the O2C process is not managed or streamlined properly, money that could be invested becomes idle. Streamlining this process will help your clients or customers view you as an efficient business partner that provides quick service.
It is easy to spot issues in your existing O2C process: long lead times, duplicate orders, late payments because of incorrect orders, or flawed order management delivery processes are just a few examples. Specific issues can include
delays between order receipt and delivery,
duplicate order entries,
inaccurate inventory information,
incorrect goods dispatch, and
misinterpretation of client orders.
Therefore, it is critical that you analyze and understand where you might be going wrong to better streamline the O2C process. Sticking to conventional, manual methods often leaves room for error. Automating this process with THINK360 by MPS, which offers flexible subscription fulfillment, will help reduce your volume of errors. THINK360 also allows information to pass smoothly from sales to dispatch and finally onto invoicing to avoid delays. THINK360 is a cloud-based subscription order management platform that maximizes your billing, enhances your ROI, and optimizes your subscription life cycle. Learn more about this innovative platform and focus on making better business decisions instead of maintaining your servers.