Automating collections in Xero beyond invoice reminders

Xero is an accounting system from New Zealand, popular there, in Australia and in the UK. Invoicing is convenient, bank payments can be matched in a few clicks, and payment reminders can be switched on in the settings. Up to a point, that is enough.

How Xero reminders work

Xero sends automatic email reminders for invoices that are awaiting payment. You set the schedule once for the whole organization, for example 7, 14 and 21 days after the due date, and a reminder can also go out before the due date. You can edit the wording and exclude selected contacts from reminders. Once an invoice is marked as paid, the reminders stop.

What Xero reminders won’t do

• Same schedule for every customer. A large regular customer and a brand new one get the same messages at the same intervals.
• No texts or calls. Xero won’t send a text or make a call, so a customer who doesn’t read their email may never notice the overdue invoice.
• Nothing after the last reminder. Once the schedule runs out, nothing else happens. Xero doesn’t add interest on its own, and a phone call or a demand letter depends on someone remembering.
• Replies land in an inbox. Someone has to read a promise to pay or a dispute, note it and decide whether to pause the reminders.

That is why many companies end up with a spreadsheet next to Xero, with the overdue list, notes from calls and the dates of the next follow-ups. It has to be updated by hand every week, and we describe how quickly that stops working in our post on collections in Excel.

What Sunbay adds

Sunbay connects to Xero and pulls open invoices, due dates and contact details. It sends reminders according to your rules.

• Separate paths for customer groups, for example by payment history, CRM segment, country or language.
• Email and text messages in the order you choose.
• Interest notes and demand letters at later stages.
• Sunbay reads customer replies. When a customer promises to pay on a given day, reminders wait until then, and a dispute goes to the account manager as a task.
• One view of all receivables, with the history of every message sent to each customer.

Tequipy, for example, invoices from Xero, QuickBooks and Fakturownia and has customers in four countries. Since Sunbay took over the follow-ups, its DSO has dropped by 30%. The details are in the Tequipy story.

When reminders are enough and when they aren’t

If your late payers are mostly regular customers who run a few days behind, Xero’s reminders may be all you need. But if the overdue list grows month after month, and someone on your team regularly calls customers and keeps notes in a spreadsheet, it is worth moving the process to a system that runs the next steps for you. See which systems Sunbay connects to on the integrations page.