Guide to order-to-cash

By Qvalia  |  Updated September 2026

Order-to-cash (O2C) is the end-to-end process a business follows from the moment a customer places an order to the moment payment is received, covering order management, credit checks, fulfillment, shipping, invoicing, accounts receivable, payment collection, and reporting.

Your sales team has worked hard to find new clients and convince them that your solutions are ideal for their circumstances. When it comes time to order, the last thing you want is for a frustrating transaction experience to muddle an otherwise sure-fire sale.

When it comes to high-volume business-to-business (B2B) transactions, there’s a lot at stake. Having a formal and well-planned out process for B2B payments is paramount to improving your customer experience and encouraging long-time partners to continue working with you.

Improving your sales in B2B commerce is all about simplifying the customer experience, as there are many roadblocks and speed bumps along the way that you have a chance to smooth out. Customers not only have to choose the right products and services that will give them value for their money but also have to work through purchase orders, invoices, and other documentation during the ordering process. Other steps like the use of credit cards add to the cost of the process and come with extra bureaucratic burden to work through, for you and your customers.

For this reason, the finance sector has a name for all the order processing a business handles: the order-to-cash (O2C) process.

In this guide, we’ll explore what the O2C process is, why it matters, and its key components.

Order-to-cash een onderdeel van uw totale verkoopproces. Wanneer een klant een bestelling plaatst, voert u deze stappen uit om de goederen of diensten te leveren en de betaling te ontvangen.

A common mistake online retailers make is treating business clients as if they were consumers. Companies make up a large part of the consumer base and have unique needs that should be addressed in O2C. B2B and B2C transactions differ in several ways:

We typically consider sales and marketing to be the steps preceding O2C as you attempt to push for conversions from potential buyers, but these efforts are not entirely absent from the O2C process either.

Similarly, even after the order is fulfilled, businesses still continue to record the activity and find new ways to optimize the procedure. These steps are also considered part of order-to-cash.

We will go into detail regarding every step of order-to-cash later on. For now, think of O2C as an umbrella term for order management, credit checks, invoicing, shipping, payment, accounting, debt collection, and other actions related to the fulfillment process.

Business-to-business refers to the business relationship between companies, for example when a company provides products, services, or both to another company in exchange for money. The customer involved is always another legal entity, organization, company, governmental organization, or NGO.

This is the case for business-to-business (B2B) payments; for example:

B2B typically involves larger cash amounts and may be, but not always, more logistically complex compared to B2C (business-to-customer). The result is a generally longer, slower process as more verifications and decisions must be made throughout.

Thanks to the rise of the “as a Service” economy, B2B transactions are likely to increase greatly in the coming years.

It should be clear as to why order-to-cash deserves attention. It directly contributes to your bottom line, whether you are selling to customers or obtaining invoices for a major purchase from another business.

By taking action regarding your order-to-cash process, you also put yourself in a position to adopt new technologies and trends that will put you ahead of the competition. For instance, roughly a quarter of B2B payments are still made by paper check rather than electronically, which leaves plenty of room for process optimization.

The exact payment methods used in these transactions depend on what the suppliers prefer, but the following are some general types. B2B is not as straightforward as B2C, as most of us rely entirely on credit cards or cash whenever we go to a store.

Invoices are the most common transactional document used by sellers. Invoices define the specifics of a transaction, including date of sale, the invoice number, both the supplier and customers full name, address, VAT identifiers, the quantity, description, price, and payment terms for the goods and services, and more.

Invoices can be paid through a variety of methods. Here are a few of the most common options:

Contant geld komt tegenwoordig vrijwel niet meer voor, of het nu gaat om B2B of B2C. Het is niet altijd even handig om al dat contante geld in één keer bij de hand te hebben, en je moet zich fysiek in de buurt van je leverancier bevinden om de transactie te kunnen afronden. Contant geld brengt ook veiligheidsrisico’s met zich mee als je het per post verstuurt. Verwacht niet dat dit in de huidige markt nog een rol speelt.

Just like cash, paper checks have the usual inconvenience and risk of cash. Similarly, processing checks is error-prone and time-consuming. Checks now account for just 26% of B2B payments, down from 81% two decades ago, and the method is rapidly losing traction in favor of digital options.

Wire transfers have one of the fastest processing times of any B2B payment method, as the funds can generally be used by the receiving party within 24 hours. Wire transfers can be costly to complete, but are ideal for international payments.

ACH wordt gebruikt wanneer geld rechtstreeks van de ene bankrekening naar de andere wordt overgemaakt. Vanwege de administratieve rompslomp die hiermee gepaard gaat, zul je het waarschijnlijk niet tegenkomen bij eenmalige aankopen, maar het blinkt uit bij terugkerende betalingen. Het is namelijk relatief snel en de kosten zijn laag. Houd er echter rekening mee dat het alleen in de Verenigde Staten beschikbaar is en dat het moeilijk kan zijn om de transactie ongedaan te maken als u een fout maakt. Er is ook een privacyprobleem, aangezien u uw bankgegevens moet delen om dit te kunnen doen.

Credit cards and ACH are already some examples of electronic payments, but another that’s gaining attention in the B2B space is the virtual card. It’s generally free of fees, fast to use, and secure. Expect to see it in the near future for business transactions. As with any credit card, one of the main downsides is the processing fees.

Sommige dienstverleners fungeren als tussenpersoon tussen de verzender en de ontvanger van het geld. De aanbieder van de betalingsgateway int het geld en stort het veilig op de plaats van bestemming. Een bekend voorbeeld hiervan is Stripe. Betalingsgateways kunnen zowel voor eenmalige als voor terugkerende transacties worden gebruikt, maar houd er rekening mee dat je bij het gebruik ervan vertrouwt op de expertise van de aanbieder van de gateway.

Payment solutions optimized for business customers, with capabilities to send invoices in various formats upon checkout. Authentication of customers can be managed via integrated workflow apps or mandatory accounts with secure log-ins.

Het order-to-cash kan worden onderverdeeld in de volgende algemene stappen: orderbeheer, kredietbeheer, orderafhandeling, verzending, facturering, debiteurenbeheer, incasso en rapportage.

Het order-to-cash begint op het moment dat de klant een bestelling plaatst. Dit kan op verschillende manieren gebeuren:

Regardless, the order management phase begins here. Use automation to notify everyone involved about the order and the next steps for it. Only then can you ensure fast fulfillment and order accuracy. The result will ultimately be a satisfied customer and more revenue for you.

Als dit de eerste aankoop van een bepaalde klant is, kan het nodig zijn om een kredietcontrole uit te voeren. Automatisering kan het grootste deel van het werk uit handen nemen, terwijl medewerkers van de financiële afdeling zich kunnen richten op gevallen die meer grondige controle vereisen.

Kredietbeheer is grotendeels een taak van de afdeling debiteurenbeheer, aangezien het ervoor zorgt dat gekwalificeerde klanten hun bestelling kunnen afhandelen, terwijl uw bedrijf alleen krediet verleent wanneer dat nodig is.

Automatiseringsoplossingen zijn hier zinvol om waar nodig realtime gegevens bij te houden. Ze kunnen ook helpen bij het digitaliseren van uw bestellingen, zodat de relevante gegevens altijd goed leesbaar zijn. Als u dit via de traditionele papieren route afhandelt, kan dat leiden tot fouten en inefficiëntie.

Mocht u een bestelling niet kunnen uitvoeren, breng de klant dan op de hoogte en annuleer de bestelling om verdere frustraties over de facturering te voorkomen.

Vanuit het oogpunt van de verkoper is het verstandig om een goed voorraadbeheer te hebben, zodat je niet zonder voorraad komt te zitten wanneer er een nieuwe bestelling binnenkomt.

De verzendfase van order-to-cash sterk order-to-cash van een nauwkeurige logistiek om betrouwbaarheid en snelheid te garanderen. Levertijden en afhaaltijden zijn van groot belang om ervoor te zorgen dat bestellingen op tijd bij de klanten aankomen.

Vertragingen bij de facturering staan erom bekend dat ze de klantervaring verpesten. Vertragingen en onnauwkeurigheden zijn voor iedereen vervelend, dus door je factureringsproces te controleren kun je je cashflow beter plannen en de frustratie bij klanten tot een minimum beperken.

The rapidly accelerating shift from analog invoice formats to e-invoicing moves the paperwork into the digital workspace. By utilizing completely digital formats, and emerging exchange networks for business documents such as Peppol, the digital management provides greater efficiency and gives you more control over the content and accuracy of your invoices. The advantages of e-invoicing are numerous:

De afdeling debiteurenbeheer is verantwoordelijk voor het bijhouden van openstaande facturen en het oplossen van eventuele fouten die tot betalingsvertragingen kunnen leiden. Deze medewerkers moeten zich doorgaans grondig verdiepen in de gegevens van het order-to-cash , zodat ze zo snel mogelijk een gecorrigeerde factuur kunnen versturen.

Daarom is factuurautomatisering in opkomst. Facturen vergen veel handmatig werk en vereisen tal van gegevens, zoals de besteldatum, levertijden, productgegevens en nog veel meer. Door die werkdruk voor uw medewerkers te verlichten, kunt u de prestaties aanzienlijk verbeteren.

Als uw debiteurenafdeling efficiënt genoeg werkt, verwerkt zij betalingen van klanten snel genoeg om in uw O2C-proces te worden verwerkt. Anders loopt u het risico dat er wrijving ontstaat met uw klanten en dat uw kasstroomprognoses op de lange termijn in de war raken.

On the other side, you also have to plan for customers being late on their own payments. In this case, the system must automatically notify those clients if they attempt to make further purchases. Your finance teams must similarly review overdue payments and make decisions based on debt forecasts.

Because invoices often have long payment terms that cause issues with cash flow, companies that sell in B2B markets consult with factoring companies. Factoring is the practice of buying up unpaid invoices at a discounted price so that the owner of the invoices gets the cash faster.

Once a factoring provider receives the invoice, that firm takes over the payment process for the invoice. Factoring makes sense when you’re okay with a lower amount as long as you receive it in a shorter time frame. In other words, you are accelerating cash flow by accepting the money before your client has finished paying off the invoice.

Het is belangrijk om te weten wat er zich in uw order-to-cash afspeelt, omdat u zo inzicht krijgt in de invloed die deze financiële activiteiten hebben op de rest van uw bedrijf:

Daarom beschikken veel softwareprogramma’s over ingebouwde rapportage- en analysefuncties. Order-to-cash sterk onderling verweven; één vertraging in een stap kan gevolgen hebben voor de rest van het proces. Het management maakt vaak gebruik van rapportagetools om kleine problemen op te sporen en aan te pakken, met als doel het ‘order-to-cash’-proces in het algemeen te verbeteren.

Businesses must frequently monitor all aspects of the order-to-cash process to make sure everything’s running properly and efficiently. There are several common metrics that experienced management teams look for in this regard.

Also known as DSO, the day’s sales outstanding metric shows us how long it takes for the business to receive the payment after a sale is made. Cash flow can be challenging to keep track of, and managers running the company on credit must know this figure to keep debt in check and track earnings accurately.

How much is the order-to-cash process contributing to the total revenue of the business? The higher this figure is, the more you are earning from selling products as opposed to other sources of income. Most management teams would obviously prefer to maximize this value, and it typically takes the form of a percentage of total revenue.

Full-time equivalent (FTE) is a measure of an employee’s workload. It matters for O2C because you want to know the individual productivity of each staff member related to sales.

If the workload is too high for the number of employees on site, then you have an indicator to assign more staff to that task. Likewise, you might want to drop some people if there are too many.

Het meten van FTE is een manier om uw kosten nu te optimaliseren en u te helpen bij het plannen van de toekomst, wanneer u moet beslissen hoeveel medewerkers u nodig heeft voor een volgend project.

We’ve mentioned before that reporting and analytics matters in the order-to-cash process, whether we’re looking at the supply chain, the inventory management, the manufacturing, or the logistics.

Regular reports give you an up-to-date picture of how smoothly everything is running and allow you to track key performance indicators directly related to O2C.

Tying into the last point, it’s clear that O2C relies heavily on paperwork, data entry, and analytics. These three tasks are all much faster and more reliable on automated software-based solutions as opposed to traditional manual methods. Adopting automation allows you to increase your throughput, minimize delays, and lower the risk of error. It also often results in better analytics and reporting capabilities. So don’t neglect keeping track of your automation rate and automation potential.

Order-to-cash is an essential process, but it’s not without its difficulties. B2B payments can be a hassle to file efficiently for several reasons.

We’re talking about paperwork. From checks to cash, the traditional methods of payment are just too slow for modern-day operations, yet they still make up 26% of all B2B transactions. Converting to digital is an inevitable change that will take some work to get going.

Een groot deel van de facturering in order-to-cash veel routinematige gegevensinvoer en fysiek papierwerk. Bedrijven hebben moeite om een evenwicht te vinden tussen dit soort taken en het belangrijkere werk dat hun medewerkers anders zouden kunnen doen. Een van de voordelen van financiële automatisering is dat er zo tijd vrijkomt voor andere taken, zoals strategische planning.

Een belangrijk gevolg van de twee bovengenoemde problemen is dat het O2C-proces over het algemeen trager verloopt. Als u deze workflow niet kunt versnellen, loopt u het risico op vertragingen of loopt u kortingen bij vroegtijdige betaling mis.

Bij grote B2B-transacties kan het soms enkele dagen duren voordat een bestelling is geplaatst en het geld daadwerkelijk op de rekening van de andere partij staat. Hoe zorgt u ervoor dat uw cashflow zo is ingericht dat er rekening wordt gehouden met die doorlooptijd?

A lot of payment methods require some type of added processing cost, which can add up especially when you have recurring payments. You will have to factor those in when doing your financial planning.

Protecting the sensitive data shared during a transaction matters, as you don’t want to lose the trust of your customers, merchants, or business partners.

Het bijhouden van de geldstromen is belangrijk om tijdens uw transacties het overzicht te behouden en op mogelijke fouten te controleren, maar veel bedrijven beschikken niet over de juiste systemen om dit te doen.

Invoicing software rarely include support for checkout solutions, and traditional payment gateways are, with few exceptions, not optimized for the needs of B2B transactions.

A recurring theme of this guide is the role of automation in solving many of the issues companies today are experiencing with regards to the order-to-cash process.

In addition to the reduced fees of using virtual cards, handling invoices through a B2B payment solution can result in several dollars saved each invoice. These amounts add up for companies managing a lot of orders.

Automation always results in better efficiency, but don’t expect it to take over your employees’ jobs entirely. These solutions aim to supplement the workflow so that human staff can focus on more interesting, and value creating, parts of the job.

Having full visibility into the activities of accounts payable and receivable gives you more options for tracking down payment statuses, managing cash flow, and finding new ways to optimize the entire process.

The threat of cybercrime is always on our mind, but thankfully many O2C solutions have responded with their own built-in security features to protect against fraud, non-compliance, and other potential threats.

Optimal O2C management lies in having access and control over every step of the process at all times. You’ll also need all the extra tools like digital invoicing, support for e-commerce solutions, payment reconciliation, and automated shipping notifications. Only recently have dedicated financial platforms arisen to allow this type of management in today’s workflows.

Order-to-cash includes all the activities, tools, and processes businesses undergo to fulfill an order from a customer. From initial purchase to delivery and the data analytics afterwards, there’s a lot that goes into this complex yet essential process.

Companies that master O2C often experience improved customer satisfaction due to fewer payment delays and setbacks. For instance, having a user-friendly B2B payment gateway in place like Qvalia’s Autobilling on your e-commerce website helps B2B customers place orders without any phone calls, expense reporting procedures, or credit cards. Fewer potential points of frustration mean better sales figures.

Automation has also helped a broad range of businesses achieve reliable O2C processes by eliminating menial tasks and facilitating comprehensive visibility, which in turn results in more ways to optimize B2B transactions.