TermSync uses data analytics to assist small and midsized businesses better know the way and when they’re being paid.
Analytics is turning up in small corners of the sector. I talked recently with Mark Wilson, whose company, TermSync, applies analytics to — get this — receivables.
That’s right, receivables — the quantity businesses are owed by their customers.
Wilson, a CPA, started TermSync in 2010. Based in Madison, Wisconsin, the corporate offers a cloud-based service to enhance transaction processing for small and midsized businesses. In 2012 it all started expanding its features, offering customers data on their accounts and on how they compare to other companies.
“We just sent them notes questioning why, when you have 30-day term, is your average collection time 47 days?” Wilson says. That got customers’ attention.
Companies make collection calls or send reminders about overdue bills, Wilson says, but they do not formally track what they have been doing. TermSync’s software automates the gathering of that data so companies can start tracking metrics about their receivables through the years.
[What’s behind Google’s most up-to-date acquisition? Read Why Does Nest Need Google? Analytics.]
According to Wilson, companies don’t pay much attention to their receivables. “It’s historically a run of the mill process that folks [don’t] put time and resources into it,” he explains. “We’re competing with Post-It notes and Outlook reminders and Excel spreadsheets.”
Wilson says adding analytics was a hard shift for his team to make as it is one more variety of development mindset. Nevertheless it paid off in sharply higher sales.
TermSync, which remains a small company with lower than $10 million in sales, runs its analytics on a quarterly basis, although customers can use its tools to accomplish their very own analytics as often as they prefer. It looks at how briskly companies pay and what kind of they write off, and gives insights into why customers don’t pay on time. TermSync sends each customer a report showing the way it compares to other companies in its industry.
So what do analytics tell a corporation about its receivables? How about this: If a bill is greater than 60 days late, it’s normally your personal fault.
In fact, using incorrect purchase order numbers on bills seems to be the number-one reason invoices are 60 days late, in step with TermSync’s analytics. The second one reason? Companies send their invoices to the incorrect person. These explanations not just debunk the typical assumptions that bills aren’t being paid on account of poor cash flow or as the customer is barely dodging the bill — additionally they provide information regarding an issue the corporate can easily fix.
Receivables will not be the sexiest application of analytics. However the advantages of knowing more about when you are being paid are clear. And when it’s getting used to create innovation in a business backwater like receivables, the ability of analytics really comes into focus.
Can the fashionable tech process of DevOps really bring peace between developers and IT operations — and deliver faster, more reliable app creation and delivery? Also inside the DevOps Challenge issue of InformationWeek: Execs charting digital business strategies can’t afford to take Internet connectivity without any consideration.
More Insights