Скачать или смотреть AR in Europe: Strategic Outlook | Emagia The Best Accounts Receivable Automation Software 2023

AR in Europe: Strategic Outlook | Emagia Accounts Receivable Automation Software
Why expect a change in performance ?

Northern Europe edging down to 50 days DSO
Southern Europe diving to 80 days DSO in 2017 and slowly moving to
70 days DSO since
Nordics flat at around 50 days DSO
UK days steadily coming down to below 40 days DSO

France has highest DSO despite laws on payment terms – more later
Austria and Portugal lowest DSO
What can we expect for each country?
Little change downwards in 2020 debtor days – expectations for 2021
B to G improvement as Governments support recovery through prompt payments
B to B increases as GDP shrinkage and COVID-19 cash flows bite harder
B to C more savings cash in the consumer pocket could speed up payments for discounts


Metrics for Northern Europe
Metrics for Southern Europe
Metrics for Nordics
Metrics for UK
COVID-19 Impact
Widespread economic shrinkage across the EU market
– GDP constricted by 7.4%
Generally, Q2 took the hit and Q3 saw recoveries with further setbacks in Q4
Impact on biggest countries by GDP and estimated growth for 2021

Cost of Credit and Cash in 2021
2021 interest rates are expected to be – 0.5%
Corporate borrowing is estimated at 1.5%
Some countries pay to have cash on deposit – making the improvement of AR performance a mixed blessing
Companies with large customer deposits are buying bonds to gain a return on holding cash
Consumers have stored up a lot of spending power which is expected to be released in 2021
Companies who took out Government cash support now face payback schedules while markets are still challenging

e-market place
Debt Collection Software Market in Europe Predicted to Reach $1.78 Billion by 2025, Report by Allied Market Research
Governments are mandating payment terms for SME’s and BtoG transactions
PSD2 is a European regulation for electronic payment services. It seeks to make payments more secure in Europe, boost innovation and help banking services adapt to new technologies.
e-invoicing is widely mandated for BtoG transactions and common practice in some countries
Supplier conformity to invoice data requirements can be an issue with manufacturing supplies, but indirect procurement is moving to e-invoicing through systems like Coupa
Flipping PO’s to invoice the customer provides accurate feed for payables systems and minimises disputes

Training and Education
Recent projects have demonstrated the need for working capital training to lay the foundations for improving cash and collections focus
Procurement organisations are the same
Implementing automated collections software in Europe is a challenging task. Factors that reduce effectiveness are:
Cross-Border differences
Country focus and payment terms
Impact of size and structure – shared service centres v local collections
Delivering a training programme can increase corporate education and create greater awareness of the importance of collections performance and automated systems
However, in our experience a lack of training budget in automation projects is the biggest single risk to success.
Few sales organisations invest in tools to help understand the cost of credit when negotiating contracts and move on terms rather than price
– modelling the trade off between terms and discount the optimum corporate value for sales or purchases.

Key Challenges and Solutions

Keeping cash in focus as post COVID-19 corporate growth dominates
Building back employee capacity and skills after government schemes to support employment unwind
Recognising the increasing and widespread pressure on faster supplier payments needs to be countered by terms offered through sales and implemented by collections
Increasing education around cash and working capital 1+1-1 =3
Optimising the accuracy and quality of transaction flows and information.

Emagia MasterClass: Driving Exponential Efficiency in Cash Application with AI
https://bit.ly/3jk5Ys9​​​​

Emagia MasterClass: 3 Reasons for B2B Digital Credit Amidst Covid and Beyond
https://bit.ly/3dPWung​​​​

Emagia MasterClass: Integrated Order-to-Cash (OTC) Transformation for Global Shared Service Organizations
https://bit.ly/35u3BON​​​​

Emagia MasterClass: High Touch to Hi-Tech: The Journey to Touchless Collections
https://bit.ly/31vaONa