DSO, or Days Sales Outstanding, is one of the most direct indicators of a company's financial health. It measures the average actual payment time of customers. For a French SME, this time is typically between forty-five and sixty-five days, sometimes more. Reducing this DSO by ten or fifteen days represents a massive release of cash, equivalent to several months of bank financing. Yet few companies treat this issue with the rigor it deserves. Structuring customer payment follow-ups is one of the highest-ROI transformations available to finance departments.
The silent cost of late payments
The consequences of late payments are multiple and cumulative. First consequence: tied-up capital. Every day of late customer payment is a day the company itself finances the business, thus consuming borrowing capacity or equity that could be used elsewhere.
For an SME with ten million euros in revenue, ten additional days of DSO represent about two hundred eighty thousand euros tied up in customer receivables. At the current average bank financing rate, that is an annual cost of ten to twenty thousand euros, silently borne by the company.
Second consequence:
- the risk of non-payment.
- The longer an invoice stays unpaid, the more its probability of becoming a definitive bad debt increases.
- Industry studies show that an invoice more than three months late has a doubled probability of non-payment, and that beyond six months the probability triples.
- The rigor of early reminders significantly reduces this risk.
Third consequence:
- the deterioration of the commercial relationship.
- Customers who get used to paying late without a reminder show less respect for their supplier.
- Conversely, suppliers who show rigor are respected and benefit from a better ranking in the payment order when the customer prioritizes its outflows.
The cultural aversion to reminders
Why do so many French SMEs manage their reminders poorly? The explanation is largely cultural. Several deep-rooted beliefs in France lead to restraint in collections.
First belief: "reminding a customer damages the commercial relationship". This belief is false. A professional reminder, courteously worded, within reasonable timeframes, is perceived as normal rigor. It is the absence of a reminder that is abnormal and that signals to the customer a certain weakness in management.
Second belief: "the customer knows they have to pay, we don't need to remind them". This belief ignores the reality of business life. Customers' accounting departments receive hundreds of invoices per month and process what they are asked to process first. An invoice without a reminder disappears in the pile.
Third belief: "reminding is unpleasant, so it should be avoided". This personal aversion of salespeople and executives toward money matters hinders the implementation of reminder procedures. Without automation, aversion wins over discipline.
Industrialization through workflows
- Odoo's Follow-ups module makes it possible to overcome these cultural obstacles through industrialization
- Once the rules are defined, reminders go out automatically, without requiring an individual decision at each due date
- Discipline becomes a process rather than a personal act
The typical configuration of a reminder workflow includes several levels. At D+15 after the due date:
- courteous email reminding of the invoice and inviting settlement.
- At D+30: firmer email, mentioning the penalty conditions provided for in the contract.
- At D+45: scheduled phone call for the salesperson or sales administration.
- At D+60: registered letter constituting formal notice.
- Beyond that, transfer to the litigation department or to an external collection partner.
This gradual escalation respects the commercial relationship by starting gently and increasing in intensity only if necessary. It also makes it possible to handle delays in bulk without overloading sales teams.
Personalization as intelligence
Industrialization does not mean uniformity. On Odoo, reminder workflows can be personalized along several dimensions.
VIP customers can receive specific treatment:
- no automatic reminder, direct handling by the salesperson.
- At-risk customers (already historically late, weakened economic sector) can on the contrary receive an accelerated cycle: first reminder at D+5 instead of D+15.
- Foreign customers can have templates in their language.
- Very small invoices (below a defined threshold) may not trigger an individual reminder but be grouped by customer.
This fine-grained configuration makes it possible to respect the specificities of each commercial relationship while maintaining general discipline.
Objective measurement of performance
Beyond automation, Odoo provides objective measurement of collection performance. DSO calculated in real time on the chosen segments. Payment rate after reminder L1, L2, L3 (how many customers settle at each level). Chronic lateness rate per customer (customers who are systematically late despite reminders). Definitive bad debt rate.
These indicators feed monthly reviews with the sales department. They make it possible to identify at-risk customers, problem segments, and commercial practices that generate delays (overly favorable payment terms negotiated without anything in return, deliveries to entities with low solvency).
The challenge of upstream commercial quality
- A sometimes forgotten truth is that the quality of collection begins upstream, with the quality of the commercial relationship
- A disputed invoice is an unpaid invoice
- A non-conforming delivery generates disputes that delay payment
- A poorly entered order creates gaps between what is expected and what is invoiced
Analysis of payment delays makes it possible to trace back to these commercial causes. On Odoo, matching payment delays with any after-sales tickets, returns or open disputes brings out these patterns. This analysis, shared between the finance department and the sales department, transforms the overall quality of the customer relationship.
A transformation to be built over time
Structuring customer payment follow-ups is not a one-off project. It is a discipline that extends over time. Definition of rules, regular adjustment based on feedback, communication to sales teams, sharing of results with management. For French SME and mid-sized company executives, it is a workstream to be conducted with care that quickly delivers measurable benefits on cash flow and on commercial quality.
ANOR supports this structuring by combining economic analysis of DSO, configuration of Odoo workflows and change management with administrative and sales teams.