O2C Order to Cash Process Cycle Services & Automation Solutions

One of the key challenges of finance managers is to shrink daily sales outstanding and speed up cash flow. Faster cash flows arms organizations with more working capital and allows them to reduce capital costs. This, in turn, allows business teams more leeway to price products and services competitively, and gain a market advantage.

Automate the entire order to cash cycle, right from capturing and fulfilling customer orders, to generating and recording receipts and collections in the general ledger, and delivering revenue analytics and reports with Datamatics order to cash solutions. The solution suite includes automated sales order processing solution, lock box, receipt application, and a customer portal solution.

Datamatics O2C solution enables businesses to strategically define the relationship with customers through out-of-the-box implementations. The built-in efficiency ensures seamless execution such that there is no delay at any touchpoint and eliminates inefficiencies throughout the O2C process.

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What is Order to Cash in Finance and Accounting?

Order to Cash are the step by step processes that unfold after receiving a customer order for purchase of products or services in an omni-channel sales environment till the realizing of the cash or the payment in the business account and an entry is registered in the accounting books. It describes the financial aspects of sales.

What is Order to Cash or O2C or OTC Automation?

O2C Automation automates all the processes right from receiving purchase orders from different channels, raising an invoice, delivering the goods, integrating the logistics movement, to receiving the cash payment, in an automated ecosystem.

How is Master Data Management and O2C related?

Business enterprises need to maintain a centralized database about their customers, quotations offered, customer agreements, history of the orders delivered, credit limits offered, etc., as a single version of truth in a central online repository. The process of maintaining this data is called Master Data Management or MDM.

MDM is important as it allows to track the invoice payments received in time and payment receivables that are defaulted. It provides high visibility about the payment outstandings and the Day Sales Outstanding (DSO). It maintains the references of orders delivered, payments received, changes to contracts, positive and negative changes to credit limits, etc., during the customer lifecycle.

What are the primary benefits of O2C Automation?

O2C Automation results in faster processing and fulfilment of the customer purchase orders or service order and faster payment realization to improve the business enterprise’s cash flow and working capital levels.

As a result of the O2C Automation all bottle necks and delays in the order processing and payment realization are eliminated while improving process efficiency.

What is Day Sales Outstanding (DSO) in Finance & Accounting and Accounts Receivables?

Day Sales Outstanding or DSO is the average time duration in days to receive a payment after a sale is concluded to the customer.

In view of the Time Value of Money, it is preliminary that a business enterprise keeps the DSO value very minimum as time lost in receiving payment is money lost, even if the payment is received sooner or later.

Maintaining a lower DSO is more important for small to medium enterprises in comparison with large and diversified businesses. DSO pertains more towards credit sales and not cash sales.

DSO is a primary indicator of gauging the credit worthiness of customers. Watching trends in customer-specific DSO is an important part of credit management activity in Accounts Receivables.

What is Bank Reconciliation in Accounts Receivables?

Bank Reconciliation is the process of tallying the company records with the bank statements and the accounts receivables.

Periodic, bank reconciliation eliminates instances of fraud and ensures high visibility of the business operations in the leadership team and all the other stakeholders.