{"id":18588,"date":"2023-04-24T02:42:59","date_gmt":"2023-04-24T06:42:59","guid":{"rendered":"https:\/\/www.sage.com\/en-us\/blog\/?p=18588"},"modified":"2023-04-24T02:43:00","modified_gmt":"2023-04-24T06:43:00","slug":"improving-customer-satisfaction-with-better-invoicing","status":"publish","type":"post","link":"https:\/\/www.sage.com\/en-us\/blog\/improving-customer-satisfaction-with-better-invoicing\/","title":{"rendered":"Improving customer satisfaction with better invoicing"},"content":{"rendered":"
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\n\t\t\t\t\t\t\tGrowth & Customers<\/a>\t\t\t\t\t\t<\/div>\n\t\t\t\t\n\t\t\t\t
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\n\t\t\t\t\t\tImproving customer satisfaction with better invoicing\t\t\t\t\t<\/h1>\n\t\t\t\t<\/div>\n\n\t\t\t\t\t\t\t\t\t

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\n\t\t\t\n\t\t\t\t\"Bill\t\t\t\tBill Fuesz<\/span>\n\t\t\t<\/a>\n\n\t\t\t\t\t<\/div>\n\n\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t<\/div>\n<\/div>\n\n\n\n

It\u2019s no secret that customers don\u2019t like surprises, at least not when unpleasant. So, it shouldn\u2019t come as a revelation that customers don\u2019t like to see inaccuracies in the invoices they receive, yet it happens far too often. It doesn\u2019t matter whether it\u2019s an extra charge on a dinner bill, an unexpected service charge for an auto repair or an invoice for more items than were ordered. Big or small, customers hate inaccurate invoices. I know I loathe them.<\/p>\n\n\n\n

On the flip side, inaccurate invoicing creates all sorts of problem for whatever entity presented the invoice. Shipped 20 units but billed for 10? Lost revenue. Didn\u2019t get the invoice out in a timely manner? Days sales outstanding suffer. Never billed the customer? More lost revenue. Complicated invoice? Confused customer. Overcharged? Angry customer.<\/p>\n\n\n\n

The results of inaccurate invoicing are burdensome. Poor invoicing practices can lead to lower customer satisfaction, a damaged business reputation, lost customers and lower market share. It can also decrease productivity while increasing sales cycles and sales costs.<\/p>\n\n\n\n

Inaccurate invoicing presents financial, reputational and potentially legal consequences. It can lead to delays in getting payments from customers, which will have a negative impact on cash flow and the ability of the business to meet its financial obligations. Disputes and chargebacks can be time-consuming and costly to resolve. Inaccurate invoicing can lead to lost revenue and profits, as a business may not be able to bill for all the products or services it has provided. Inaccurate invoicing can lead to compliance issues, particularly for businesses that are required to comply with specific regulations, such as sales or value-added taxes. It makes it harder to accurately report on cash flow, which makes it difficult for a business to make informed decisions. Inaccurate invoicing can lead to legal woes if customers or regulatory bodies decide to act against a business. And it can damage the reputation of a business, as customers may view it as unprofessional and untrustworthy.<\/p>\n\n\n\n

I\u2019m going to spend the next few paragraphs looking at the economic impact of inaccurate invoicing and then spend some time explaining more about how this affects customer satisfaction, so bear with me.<\/p>\n\n\n\n

In its recent report The Total Economic Impact<\/em>\u2122 of Sage Intacct<\/em><\/a>, Forrester quantified the impact of accurate customer billing on a company\u2019s margin. Let\u2019s walk through the methodology it used to produce a real dollar figure.<\/p>\n\n\n\n

Forrester interviewed four customers with experience using Sage Intacct, aggregated the interviewees\u2019 experiences and then combined the results into a single composite organization, a technology services company, headquartered in North America with global operations. The composite generates $30 million in annual revenue, has 100 employees, and grows 20% annually via acquisitions during the three-year TEI analysis period.<\/p>\n\n\n\n

The four interviewed organizations said that, prior to Sage Intacct, their accounting and financial systems were disjointed, complex and problematic. The financial processes resided across multiple platforms, such as enterprise legacy systems, bookkeeping software, spreadsheets and other applications. These systems included QuickBooks and Oracle NetSuite.<\/p>\n\n\n\n

Due to lack of system consolidation and automation, the organizations used laborious manual processes to bridge data gaps, often requiring additional labor to perform maintenance tasks, such as replicating the data in prior legacy and third-party software solutions or tracking contracts and invoices in individual spreadsheets.<\/p>\n\n\n\n

After the investment in Sage Intacct, the interviewees acquired visibility into their organizations\u2019 financial performance and had confidence in their numbers due to the platform\u2019s real-time data. They gained financial insights and the ability to slice and dice the data, drill down on numbers and isolate any issues with a particular number, none of which was possible in their previous environments.<\/p>\n\n\n\n

As a result, Forrester calculated a $737,100 total three-year margin benefit gained due to more accurate customer invoicing, with a present value of $604,001. Let\u2019s look at the details.<\/p>\n\n\n\n

Evidence and Data<\/strong><\/h2>\n\n\n\n

Prior to deploying Sage Intacct, the interviewees failed to renew several contracts and bill customers due to fragmentation in their systems, and sales orders didn\u2019t require corresponding purchase orders. This lack of organizational cohesiveness led to missed revenue because customers were never invoiced or their contracts weren\u2019t renewed, even though they received continued access to services. Sage Intacct ensures the creation of a sales order and purchase order at the same time, providing additional visibility into customer status and ongoing engagement.<\/p>\n\n\n\n

The lack of agility and integration of their prior solutions with their other systems, such as sales, banking and external third-party CRM solutions (such as Salesforce), was an issue. They found their systems didn\u2019t communicate effectively, so they had to enter the customer data into two solutions simultaneously to create a full picture, which was not comprehensive or accurate. With their double-digit growth, this duplication wasn\u2019t sustainable and created blind spots as well as an incomplete and inaccurate data environment that led to unrealized revenue.<\/p>\n\n\n\n

For example, when consultants didn\u2019t find a specific customer in the system, instead of adding the customer, they categorized their hours as other or nonbillable, which would then become an absorbed expense without associated revenue. With Sage Intacct\u2019s advanced integration with their third-party CRM, the consultants got full visibility into their customer\u2019s status and easily located them to bill. As well, salespeople created an invoice in their CRM solution that became a sales order in Sage Intacct. The accounting team then took over, converted the order to an invoice, and sent it out to the customer.<\/p>\n\n\n\n

The CFO at an ERP consultancy stated, \u201cWhen they go into the contract in CRM and add an opportunity, it automatically creates an entry in Sage Intacct that\u2019s connected to that contract.\u201d This advanced integration created a one-stop shop and enabled interviewees to transfer more control to sales representatives, making sales team members\u2019 jobs easier and lives happier.<\/p>\n\n\n\n

Modeling and Assumptions<\/strong><\/h2>\n\n\n\n

Based on the customer interviews, Forrester estimates the following for the composite organization:<\/p>\n\n\n\n