The verdict in three sentences
A 120-person services SME in Dublin with a 68-day DSO is financing its customers beyond the 60-day ceiling that Irish late payment rules set for agreed B2B terms. Automating reminders by customer segment, with workflows connected to the accounting system, makes a 48-day target realistic within two to three quarters. Market tools cost 150 to 600 EUR a month; a custom Kolonell solution sits between 3,810 and 22,870+ EUR depending on complexity, with the rest set in the quote.
Why DSO is stuck at 68 days
With 1,400 invoices a month, a three-person finance team chases case by case, usually once an invoice is already 30 days late. Reminders go out without priority, disputes are not separated from simple oversights, and large accounts get the same email as micro-businesses. The table shows common causes in services SMEs (2026 order of magnitude).
| Cause of delay | Share of late invoices | Effect on DSO | Automated response |
|---|---|---|---|
| First reminder sent too late | 35% | +8 to 10 days | Pre-due reminder at day -5 and nudge at day +1 |
| Non-compliant invoice (missing PO number) | 20% | +6 days | Mandatory field checks before sending |
| Unflagged dispute | 15% | +12 days | Query button in the email, ticket routed to the account manager |
| Wrong contact at the customer | 12% | +5 days | Accounts payable contact required on the customer record |
| Customer in difficulty | 10% | +20 days | Risk score, switch to phone at day +15 |
| Plain oversight | 8% | +3 days | Card or bank transfer payment link in every reminder |
The legal framework helps. Under the European Communities (Late Payment in Commercial Transactions) Regulations 2012, a supplier can claim fixed compensation of 40, 70 or 100 EUR per invoice depending on its amount, plus statutory interest at the ECB rate plus 8 points. Mentioning this politely from the second reminder noticeably changes the behaviour of habitual late payers.
Segment workflows instead of a single template
A multinational with a supplier approval workflow does not run at the same pace as a small business paying by bank transfer from a phone. Segmentation is the core of the system.
| Segment | Share of revenue | Contract term | Workflow | Channel |
|---|---|---|---|---|
| Large accounts | 45% | 60 days | Day -10 approval check, day +3, day +10 call | Supplier portal, email, phone |
| Mid-sized companies | 30% | 45 days | Day -5, day +1, day +8, day +15 formal notice | Email, then registered letter |
| Small businesses | 15% | 30 days | Day -3, day +1, day +5 with payment link, day +12 | Email and SMS |
| Public sector | 7% | 30 days (15 days prompt payment target) | Status tracking, day +15 | e-procurement portal, email |
| At-risk customers | 3% | Upfront or deposit | New work blocked if overdue | Phone |
The software reads invoices and receipts from the accounting system, recalculates due dates every night and never chases an invoice that is already paid. Every exchange is logged on the customer record, visible to sales before a meeting.
Market tool or custom build
Subscription dunning platforms fit an SME with standard accounting well. Custom development makes sense when workflows depend on business data: project milestones, purchase orders, framework agreements, supplier portals of large accounts. Market prices are 2026 orders of magnitude.
| Option | Indicative cost | Accounting connection | Business-specific workflows | Ownership |
|---|---|---|---|---|
| Manual chasing in spreadsheets | 0 EUR, about 1.5 FTE tied up | Manual export | No | Yes |
| Entry-level dunning platform | 150 to 250 EUR per month (market) | Standard connectors | Limited | No |
| Advanced dunning platform | 400 to 600 EUR per month (market) | Yes | Moderate | No |
| Kolonell custom, simple | 3,810 to 6,100 EUR | Yes, via API | Per segment | Yes |
| Kolonell custom, medium | 6,100 to 10,670 EUR | Yes | With dispute portal | Yes |
| Kolonell custom, complex | 10,670 to 22,870+ EUR | Yes, multi-entity | With risk scoring and CRM | Yes |
Over three years, a platform at 450 EUR a month costs 16,200 EUR. Maintenance of a custom tool runs at 53, 114 or 183 EUR per month depending on the service level; specific connectors (supplier portals, CRM) are quoted separately.
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Aoife, CFO of a 120-person services SME in Dublin, reports annual revenue of 14,000,000 EUR. One day of DSO equals 14,000,000 / 365, about 38,360 EUR of tied-up cash. Moving from 68 to 48 days frees 20 days, or 767,000 EUR.
With a short-term facility at 5.5%, the avoided cost reaches 42,000 EUR a year, plus finance team time: 0.8 FTE redeployed to analysis, around 45,000 EUR fully loaded. Even at the top of the complex band, 22,870 EUR, the investment is covered in under four months of gains.
FAQ
What DSO is realistic?
For a services SME with 45% large accounts on 60 days, 45 to 50 days is achievable in 6 to 9 months. Going below 40 days usually means renegotiating contract terms.
Do automated reminders damage customer relationships?
Not if the tone escalates gradually and disputes are taken out of the flow. In practice, 70 to 80% of overdue invoices are settled after the day +1 reminder, which reads as a simple nudge.
Which accounting systems can be connected?
The main packages used by Irish SMEs expose an API or scheduled exports. Feasibility is checked during scoping, in 1 to 2 days.
How long does the project take?
Allow 6 to 10 weeks for a segmented version connected to accounting. Workflows run for one month on 20% of customers before full rollout.
What about e-invoicing?
Ireland is preparing domestic B2B e-invoicing in line with the EU ViDA package, with phased obligations expected from 2028. The reminder module relies on invoice status data, so it adapts to e-invoicing when it arrives.
Let's scope your project. A segmented reminder tool connected to your accounting system is scoped in two workshops and goes live in 6 to 10 weeks. Detailed quote within 48 h. WhatsApp +221 77 596 93 33.
Mohamed Bah
Fondateur, Kolonell
Passionate about digital and entrepreneurship in Africa, Mohamed has been helping Sénégalese businesses with their digital transformation since 2020. Founder of Kolonell, he believes every SME deserves a professional and accessible online présence.
