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Real Estate Accounting: Secret to Accelerate Collections

  • It doesn’t matter you have a single shop or you are in a partnership or you have a chain business all over the world, you have to manage your accounts receivable effectively. Moreover, it doesn’t matter at which level your business is operating, after all, receivable plays an effective role in keeping your organization solvent.

    According to the cited report of 2016, industries such as real estate, restaurant, and hospitals are the leading industries that outsource their accounting operation to external companies. This has contributed to the global outsourced market size up to $76.9 billion. The factors like current economic difficulties and other are the obstacles that impact the performance of accounts receivable, which you can’t control. But here we are going to explain top 3 secrets to accelerate receivable of your real estate business:

    1- Proactive vs. Reactive - Your traditional manual collection procedures are inefficient, you always need real-time appropriate receivable data, which is possible with the help of software like QuickBooks, NetSuite accounting etc, that helps you to highlight key metrics. This not only saves your time also improves the customer experience because latest updated data helps you to avoid uncoordinated collection calls to customers.

    2- Reminders and Tasks – Whenever you sold some product or ordered is placed, always send an invoice immediately, as it reduces the day's sales outstanding (DSO). One thing you must make sure on your side to reduce the lack of visibility into the delivery of invoice because late payer usually claims that they didn’t receive the invoice and sometimes your customers can ask you to resend the invoice. In this, implementing automation tools and taking follow-ups really helps to maintain receivable effectively.

    3 - Make loyal customer- After making a sale or sending the invoice, you must regularly communicate with customers for any good events. This helps you to make them a “loyal customer” not only this will make a good relationship but also helps in getting paid faster.  

    This process should be followed by businesses especially those have numbers of transactions on a daily basis like retail stores. Accounting for retail store is so complex and time consuming for their team that it deviates the focus of team from core business tasks.

    That’s why many businesses prefer to outsource accounting services to streamline their receivable process and accelerate collections.