Record to report / R2R – Reconciliations
Customer
The need to do a reconciliation between the main and subsidiary books was cover in the previous post.
https://faoblog.com/processes-record-report-r2r-reconciliations-subsidiary-books/
This reconciliation also gains importance where ERP systems are being upgraded to either a new system or an updated version.
Let us look at customer reconciliations now.
This process is one perfect candidate for outsourcing / back office work. It covers both processing / back office work and also voice related calling.
One interesting customer that I did some outsourcing for found this process very beneficial. This customer had about 4 million direct customers, about 50000 retail customers and about 20 big customers in the US. For the direct customers, the average sale size was about $50, recurring on a monthly basis, for the retail customers about $10,000 a month and for the larger customers, about $200,000 per month.
Their total turnover was about $ 20 billion, with a write-off amount of almost over $600,000.
When we started following up with individual and retail customers, in a span of six months the annual write-off run rate was reduced to almost $200,000. We also saved them in terms of labor arbitrage on about 40% of their total cost, across six units.
And this could be made possible by doing accurate customer reconciliations.
The calls and the follow ups added the needed value.
More on this in the next post.
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