Improve Your Billing Process
The best place to start is by defining the billing process itself. Without an understanding of each step, there will be no framework for improvement. Billing, by its nature, is complex and difficult. It requires a very specific personality, as a fine line must constantly be walked between customer service and duty to the school. The process starts from the first time you meet a student, whether through an online application or in person. And it continues throughout the student’s time at your school.
The billing process begins with student registration. Capturing information completely and accurately is the most important step in the process, as incorrect address or biographical information renders the rest of the process moot.
Determine Billing Schedules
Once this information is captured, the billing office must understand the schedule for billing this particular student’s charges. Although most schools offer several payment schedules, the most common being one, two, and ten payments, placing the student on the correct billing schedule immediately encourages on-time payment and sets the groundwork for the school’s cash flow forecasting.
Capture and Bill Charges
The school must then begin capturing every charge relating to the student’s time on campus. Of course, the primary charge will be tuition, but financial aid must be appropriately applied, if applicable, and any secondary charges such as meal plans, bookstore items, lab fees, and field trips must be charged accurately.
Once the bill goes out, payments are received and applied against the outstanding balances. Managing receivables at this point is more a matter of accuracy in data entry than anything else, but timely reporting can benefit the organization by identifying delinquencies.
Finally, any outstanding items require diligent follow up. This is where the right personalities in the business office can make the biggest difference. The process then begins again.
Why Improve Your Billing Processes
Schools are in business of providing an education to young men and women. In return, they charge tuition. The accurate billing and collection of this tuition drives revenue for the school and ensures its long-term sustainability. But a more efficient and effective billing process has additional ramifications.
For starters, it can lower the cost of doing business. Using electronic billing, for example, can reduce the amount a school spends on paper, postage, and envelopes. However, when mailing statements, batching them and using bulk mailing rates can also help cut down on unnecessary costs.
And, of course, improving the timeliness of collections will improve a school’s cash flow. The faster the money comes, the more valuable it is to the school. Money today is always worth more than money tomorrow.
Another often overlooked benefit is improved relationships with parents and students. By having a well-documented, consistent, and fair process, each parent will have a clear understanding of what is expected of them and will also understand that no one gets treated any differently.
Finally, by collecting more of the charges that are billed the school will increase its revenue.
Want to Learn More?
Understanding the billing process as well as the reasons for improving it is just the first step. Join us for Improve Your Billing Process on Thursday, July 11th at 1:00 PM ET to learn how your organization can be more efficient and effective in each phase of the billing process.