Effective accounts receivable (AR) management keeps cash flowing smoothly and supports business growth. Late payments hurt cash flow—in 2025, 43-44% of US B2B invoices remain overdue, with bad debts around 3-6% of credit sales (Atradius Payment Practices Barometer US 2025).
This guide shares 10 essential tips to build a stronger, more efficient AR process—with updated industry data, quick tips, quotes, and actionable steps.
1. Get Organized: Build a Solid Credit Policy
Start strong by screening customers before extending credit.
- Require a credit application: references, financial details, and business verification.
- Make contracts crystal clear: due dates, payment methods, late fees, and early-payment discounts.
- This protects you legally and sets clear expectations.
2025 Insight: Companies with formal credit policies reduce risks. Overdue invoices affect 43% of credit-based B2B sales in the US (Atradius 2025).
“A clear policy isn’t paperwork—it’s your first line of defense.”
Quick tip: Review and update your policy every year.
2. Set and Enforce Smart Credit Limits
Don’t let credit become a liability.
- Base limits on credit history, financial health, and your risk tolerance.
- Start low for new customers; increase as they prove reliable.
- Monitor and adjust regularly.
Businesses that use limits often reduce bad-debt write-offs by up to 20% (a trend consistent with recent reports).
Example: New client orders big? Start at a $5,000 limit. After three on-time payments, raise to $15,000—builds trust safely.
3. Build Real Customer Relationships
Treat customers as partners, not just payers.
- Use CRM to track interactions and history.
- Send personalized notes, calls, or social media engagement.
- Assign a dedicated contact who understands their business.
Strong relationships make collections easier—valued customers pay faster.
Question: When did you last thank a client for on-time payment?
4. Send Timely, Automated Reminders
Procrastination causes delays—remind proactively.
- Schedule: 7-10 days before due, on due date, then 3/7/14 days after.
- Automate via accounting software to save time and reduce errors.
Stat boost: Automation cuts bad debt by 10-15% and speeds payments (ResolvePay & 2025 insights).
Pro tip: Personalize: “Hi [Name], gentle nudge—Invoice #123 due soon!”
5. Act Fast on Overdue Payments
Delay worsens outcomes—act immediately.
- Contact gently: “Any issues with the invoice?”
- Escalate professionally; keep detailed records.
2025 Reality: 43-44% of B2B invoices overdue; average wait ~43 days in some reports (Atradius & CashinUSA).
6. Customize Communication & Stay Professional
One-size-fits-all fails—tailor your approach.
- Segment: High-risk needs frequent touch; loyal clients get light reminders.
- Remain empathetic, calm, and professional.
Professionalism preserves relationships and drives results.
Idea: Friendly tone day 1 overdue → firm but polite by day 30.
7. Offer Flexible Payment Options
Be understanding—flexibility helps everyone.
- Propose plans, partial payments, or small, quick-pay discounts.
- Shows partnership and boosts recovery.
Data point: Flexibility increases repayment by 15%+ (Experian trends).
Example: “We can split into three payments—does that help?”
8. Nail the Collection Call
Calls work when prepared and empathetic.
- Review history before calling.
- Start: “How can we resolve this?” Listen and solve.
Focus on solutions—a good call turns late payers into loyal ones.
Script starter: “I noticed the invoice is overdue—is everything okay?”
9. Embrace Technology and Automation
Let tools handle the routine work.
- Use AR software for invoicing, reminders, tracking, reports.
- Add AI for risk prediction and faster workflows.
Impact: Best-in-class cut DSO to 25-35 days vs. average 40-55 days (2025-2026 benchmarks). Over 60% of CFOs plan more finance automation in 2025.
10. Know When to Call in Experts
Some cases need professionals.
- Consult lawyers or AR recovery specialists for big/tricky accounts.
- They navigate legal steps efficiently.
When to escalate: Over 90 days overdue with no response—act now.
2025 AR Industry Snapshot (US B2B Focus)
Key stats from Atradius Payment Practices Barometer US 2025 and related reports:
Final Thoughts: Turn AR into a Strength
AR is a strategy, not just billing. Combine clear policies, personal touch, automation, and fast action to get paid faster, slash bad debts, and strengthen customer bonds.
“Automation frees your team to focus on relationships and results.”
Ready to improve? Start with one tip—like automating reminders—today.
What’s your biggest AR challenge? We’d love to help!
Arif Anam
Arif Anam is a CX and BPO marketing professional with over 20 years of experience driving business growth through scalable, technology-led customer experience solutions. At Fusion CX, he works closely with sales and delivery teams to help organizations improve efficiency, performance, and customer outcomes. He’s especially passionate about turning real operational strengths into clear, customer-first stories that connect with decision-makers.
