What's your secret for increasing Accounts Receivable Turnover?

If all things fail, rethink the revenue model! Is there a way to deliver products and services where customers will "gladly" pay upfront? Or at least "subsidize" a part of the cost until products and services are delivered/rendered.

Wayne
Assuming you're focusing on the collection phase of a sale, I guess I would say this:
"Balance the opportunity for a sale against the risk of collection, then make sure both the sales process and the collection process work tightly in sync." If they don't work in sync, your company will sink!

Each company has its own risk profile for bad debts and poor customer service, and industries do as well. So, the best way to avoid collection issues is to prevent them, not have a huge collections department. That means having sound sales and order fulfillment processes up front. Collection is far easier when that happens. If you know that your sales efforts will inherently create collection risks, then beef up credit reviews (Emerson makes some great suggestions here).

In general, customers do not pay their bills for one of three fundamental reasons:
1. The company did not deliver what was expected (goods, services, quality, on-time delivery, pricing);
2. The company did not produce “accurate paperwork” (late invoicing, poor invoice detail/errors, inaccuracy of export documents, missing PO number); or
3. The customer lacks the money.

Where can you fix those reasons so that collections is reduced?

Once you have done that, then look at your collections practices. Are collection staff empowered and trained to address issues or to slow walk the resolution? Do they have the tools to track and monitor their accounts? How do you handle new orders from "suspect" accounts?

Include detection of signals that issues may arise: product recall, peak in customer service ticket requests for product/service failures, macro-economic events. Tie sales rep comp to collection levels.

What I may add to Len Green's excellent reply is to focus on developing a cross functional integrated view on customers. Focal points: KYC, customer relationship management and customer profitability (revenues vs direct and indirect costs and financial risks). Furthermore: optimize order to cash in terms of people, process and systems and make it easy for the customer to communicate with you /your organization.

About collecting faster. Technically, you cannot collect faster than the terms you agreed upon with your customer. If you want to collect faster i.e. get paid earlier than the terms indicate, you have to reward the customer (early payment discount - it may work, but it is expensive) and make the payment process as easy as possible (preferably electronic).

Constant monitoring and follow-up. Engage the sales force in collecting. Addressing past due amounts early in the process rather than months later. Stress to the customers that you have held up your end of the deal by providing the product/service according to the agreed terms. Now they need to hold up their end of the deal.

Look at a vendor managed inventory (VMI) program. https://en.wikipedia.org/wiki/Vendor-managed_inventory

Adding to what Len, Marcel & Mark have stated:
With few exceptions, if businesses do not extend terms /credit; buyers will buy less or go elsewhere( and probably not return) no matter how well the product or service is priced, designed or made. For small orders under a certain dollar amount (typically $700 -$1000) please get pre payment. For those smaller amounts
it the buyer doesn't pay it may make sense to send it to a collection agency but it doesn't make sense to sue.
For those larger orders extend credit only to those are credit worthy and only to the level they deserve. Credit should always be checked no matter how long they have done business with you. No one is ever going to tell you to ship the order, they may not be able to pay on time or at all.

Establish Standard Operating Procedures for Accounts Receivables including follow up times. All past due invoices at 80 days should be given a final demand and at 90 days past due turned over to a collection agency. At 90 days there is a 30% less chance of collecting the debt. At 6 months it is 52%.

One exception is the food industry where times must be shorten especially for perishables. Another is for any consumer goods with invoices due before January 1st .Those invoices should be sent to a collection agency by the second week in January because if they don't have money after the holidays when will they!

Sales people at most should contact the debtor only once because the debtor will now look to avoid them; making additional sales much more difficult.

If extending discounts for paying early (ie: 2/10 net 30) be aware that many businesses will look to take the discount without paying early.

Other commentators have good points and some best practices.
I categorize the efforts in 2 main groups
1) Tactical ---- e.g., make sure my order mgmt. and A/R groups have the customer master files set up properly; quality control the shipping and invoicing documents; follow up in person w quick phone call to customer that they received the invoice and are fine (for large invoices and/or new customers); also follow up several days before invoice due date to check that customer has invoice in their system and doesn't have issues----basically stay top of mind, be the (Friendly) squeaky wheel.
2) Strategic ---- working with mgmt., select our customers and vet them carefully; manage our channels to minimize channel conflict (pricing, territories, etc); design sales commission plans that incent sell through and NOT stuffing the channel; participate in Concept Commits for new product to make sure we are developing products that customers will want at these price points

- my perspective is as a CFO/COO of Consumer Tech Hardware OEM, selling product into indirect channels, sometimes thru distribution, other times directly to a reseller.

I like the idea of getting sales involved with collections for late payments on A/R's. After all, they have the relationship the customer. Yet, collection calls are not necessarily a desireable job function for some. If collections are the responsibility of the accounting department, I recommend providing an incentive to the "collector" to reduce past dues. I had a client that was experiencing increasing past due A/R's and it was not due to problems with the product. When one of his accounting staff was incented on collecting A/R's, past due invoices reduced dramatically.