The Telephone as a Collections Tool

In our article “How Top of the World Headwear’s AR Team Captures the Cash,” we look at the ways one savvy AR department uses communication—particularly the telephone—to get customers to pay their bills. Research by the AR &O2C Network also sheds light on how companies use the telephone as a tool for contacting debtors.

The Accounts Receivable Network surveyed more than 200 organizations of all sizes and industries. More than one-half (57 percent) of the responding AR/Credit and Collections departments are centralized and about one-quarter (27 percent) are shared services operations. Fewer than one in 10 (9 percent) are decentralized.

Key Metrics
  • The median DSO is 43; the mean is 43.7.
  • The median mean days delinquent is 22.
  • The median percent of current AR is 70 percent; the mean is 64.6 percent.
  • Median bad debt as a percentage of credit sales is 0.6 percent.
  • Median collection cost per dollar collected is $0.12.
  • For the most recent month, 68 percent of the prior month’s past due was collected.
  • The median percent of total outstanding AR considered to be at high ...
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