If you’re like many of your peers, you’re looking for ways to make sure customers and clients stay loyal to your company in the new year and beyond. Digitizing your A/R and A/P departments is key to accomplishing this, according to new research from PYMNTS and Versapay.
Per the Strategic Role of the CFO report, 70% of CFOs are currently planning to digitize A/P and A/R to improve the customer experience and retain business.
And for 96% of them, their primary reason for going digital is solely to benefit vendors and customers.
As a result of the pandemic, there’s been an increased demand for electronic payment processes from clients, vendors and customers.
But companies without those options are finding out the hard way how much that can hurt the bottom line. So digitization has become a primary focus for most CFOs.
There are several other benefits to modernizing your A/P and A/R processes, including faster payment processing and more cost-effective operations. But retaining customers is top of mind for your peers right now.
Along with updating their tech, CFOs are taking additional steps to improve the customer experience and boost customers’ lifetime value to the company, such as:
- Offering a variety of new payment terms
- Educating customers about A/P & A/R using clear language, and
- Taking steps to secure customers’ financial info and protect their privacy.
These actions not only improve your relationships with vendors and customers, they can make transactions more efficient overall. And they can give you a significant return on investment for tech upgrades.
Measuring success with customer retention
To make sure they’re achieving all their goals with A/R and A/P digitization, CFOs are crunching the numbers and relying on three crucial metrics to measure their success:
- A/R turnover
- A/P turnover
- Average cost of services
Other key performance indicators you should keep an eye on include inventory turnover, customer acquisition cost, customer retention rates and average revenue per customer.
Examining these metrics and watching how A/P and A/R digitization initiatives affect customer interactions will help your company stay competitive. They’ll also keep you poised for significant financial growth in the future.