For any service-based business, cash flow management is a critical problem to tackle. Many times, employees and contractors have to be paid on time, but customers may choose different payment cycles based on the project.
By digitizing invoicing via field service management software, it is possible to solve cash flow issues. In this article, we cover how FSM software ensures positive cash flow by implementing best invoicing practices.
Challenges in managing cash flow for a field service business
Here are the top five challenges every service business will concur by:
- Delayed payments: in the service industry, it is common to receive payments post-service delivery and incorporate feedback. Sometimes, delayed payments are caused due to disputes, complex payment processing terms, etc.
- Logistical expenditures: a field service business has to invest in equipment, labor, or materials that are essential for service delivery. Upfront payments may solve this issue, but taking advance is uncommon in the field servicing tasks.
- Emergency expenses: it is possible for a field service technician to face an accident on the job or face equipment failures. Such instances cause unexpected expenses.
- Lack of business visibility: it is difficult to track expenses, income, and overall work completed by remote field service technicians. Such gaps can lead to unaccounted business expenses, which many businesses cater to in order to keep customers satisfied.
- High competition in the market: many field service operations are not recurring. Hence one has to keep marketing their brand and launch promotions to acquire new customers. Sudden disasters like COVID-19 can lead to major cash flow issues too.
Many of the above challenges are possible to tackle using invoice management best practices.
How an invoicing software improves field service businesses’ cash flow?
There are five key ways in which invoicing software within a field service management app helps streamline cash flow:
Faster invoicing with automation
When the field service technician completes the job, a field service management app will pass on the complete billing data to its invoicing features. It is possible to automate invoice creation with pre-defined variables, which are then sent directly to the customer. This removes any manual intervention by team members, thus avoiding any delays in sharing the invoice.
Click Here – How To Disable Mcafee?
Automatic payment reminders
Once an invoice is shared, it can get painful to follow up with the customers. It is also possible to miss out on payments and not follow up if your staff is overworked. An invoicing software ensures you do not have to manually take care of payment reminders. It will automatically space the reminders and separate paid invoices from unpaid ones. For defaulting clients, you can place personal attention to ensure timely payment.
Predict cash flow and financial health
It is possible to track invoices and know cash flow availability at a certain time. It can also predict cash flow for the future based on past customer data. Such predictions help your field service business prepare for any potential downturn and align resources to mitigate. It can also give you the confidence to invest in new business opportunities or implement riskier strategies.
Better payment dispute resolutions
By digitizing invoicing, it is possible to have an audit trail of the transactions done with any customer or vendor. With proof available due to online payments and invoice tracking, one can provide the necessary proof of financial activity. If your business uses an escrow system for advance payment or larger transactions, it makes it easier to build trust for both parties.
Perform financial analysis and accounting using invoicing data
It is possible to integrate the invoicing software with your existing accounting system to send and receive data. You can analyze customer behavior, popular services, duration of service delivery, customer feedback, and much more.
Using field service management software that comes integrated with invoicing and accounting tools is a more convenient option than using multiple tools. For example, Zuper allows data analysis across multiple field service operational workflows, including invoicing.
Fix invoicing to experience growth with better cash flow management
It is better to digitize your invoicing process to get started with disciplined cash flow management. Maintaining cash flow is critical for a field service business’s survival, and using field service management software will provide much-needed financial visibility.
At Zuper, we provide complete invoice management tools as a part of our field service management software suite. Book a demo to know how we can help automate your invoicing and suggest strategies to improve cash flow.
