Recently updated on January 24th, 2024 at 01:19 pm
It’s not a surprise that the Accounts Payable (AP) teams can level up the game with automation. More than just paying bills, AP automation solutions wield influence over cash flow, fraud security, and supplier relationships. However, the effectiveness of your AP team hinges on their approach. Many teams grapple with manual processes. This leaves little room to enhance cash flow or prevent errors. Eventually, paying bills becomes a nightmare, taking weeks instead of days. The good news? It doesn’t have to be this way. AP automation paves the way for a more efficient and effective AP team, unburdened by unnecessary delays and errors. Let’s explore how it can change the game for your AP processes.
Top Reasons You Should Invest in AP Automation Solution
Manual handling of invoices and payments can be a significant drain on resources, both in terms of time and costs. Here are nine compelling reasons why automating your accounts payable process is not only a wise investment but a strategic requirement.
1. Bolster Your Bottom Line: Save on Costs & Achieve Greater ROI
In the relentless pursuit of financial excellence, businesses are increasingly turning to automation to streamline their accounts payable workflows. Manual processing, particularly of checks and invoices, incurs significant costs. For instance, the manual cost of processing a single check is a hefty $5.00.
It is astonishing to observe the continued prevalence of check payments in the United States. Recent survey indicates that businesses in the US still write a staggering 19 billion checks annually to pay vendors. These checks account for most transactions, including payments between business-to-business transactions and business-to-customer payments. However, the inefficiencies inherent in this conventional system come at a significant cost, with each transaction amounting to approximately $65. When multiplied by 19 billion, this translates to well over a trillion dollars spent on inefficiency-related problems in the US. Imagine the immense potential for growth and progress that businesses could unlock with those financial resources.
With faster payment processing and reduced processing times, automation not only saves costs but also drives a greater return on investment.
2. Seamless Scaling: Grow Your Business Without Adding Headcount
For companies experiencing rapid growth, scaling the accounts payable department manually can be a daunting challenge. However, automation presents an elegant solution. A survey indicates that 64% of companies with automated AP process more invoices with the same number of people. The ability to handle increased invoice volumes efficiently is a clear advantage for businesses aiming to expand without the burden of extensive manual processes.
3. Swift and Precise Invoice Data Entry: Enhancing Productivity
In the traditional accounts payable workflow, manual data entry is a bottleneck leading to data inaccuracy, lack of visibility, and delayed responses. The shift to automation, powered by advanced Optical Character Recognition (OCR), ensures precise and swift invoice data entry. By automating this critical aspect of the process, businesses eliminate issues related to late, duplicate, lost, and erroneous payments. This not only enhances accuracy but also allows your AP team to focus on higher-value tasks, contributing to overall productivity.
4. Adaptability to Hybrid Work Environments: A Modern Necessity
The modern work environment is increasingly hybrid, with a mix of remote and in-office employees. AP automation ensures a consistent and streamlined workflow, synchronizing invoice and payment data seamlessly across remote and in-person work settings. In a world where flexibility is key, manual and paper-based processes are no longer efficient for managing AP processes.
5. Time Efficiency and Error Reduction: A Winning Combination
In a world where time is money, automating accounts payable processes becomes crucial. The sheer volume of invoices managed manually increases the likelihood of errors, such as paying the same invoice twice. Automation, with features like enhanced OCR and cloud-based storage, streamlines the entire lifecycle of an invoice. This not only reduces errors but also significantly cuts down processing times, allowing your team to focus on strategic initiatives rather than getting bogged down by manual tasks.
6. Enhanced Visibility for Multi-Entity Businesses: Stay in Control
For businesses operating across multiple entities, having complete visibility over invoices and payments is a challenge. Automation, surprisingly, enhances rather than obscures operations. By automating accounts payable processes, businesses gain increased visibility through instant, customizable reports. These reports provide essential insights into payment statuses, average approval times, and overall processing efficiency. For multi-location businesses or franchises, AP automation serves as a central hub, streamlining operations without manual intervention.
7. Strengthen Supplier Relationships with Vendor Portal
We all know that a transparent and informed vendor relationship contributes to the overall success of the business. Vendor Portal, a pivotal feature in AP automation solutions, transforms vendor interactions. Effortlessly create and manage tailored vendor accounts with just a few clicks. The standout feature allows seamless invitations to multiple vendors, offering insights into financial interactions. Vendors gain a comprehensive overview, enhancing their ability to manage cash flow effectively. Embrace Vendor Portal for streamlined processes and fortified, informed supplier relationships, contributing to overall business success.
8. Compliance Assurance: Protect Your Finances
AP is a prime target for fraud, making compliance monitoring and process control critical. Automation offers a robust solution by limiting user access to authorized functions and ensuring a traceable audit trail from invoice to payment. Fraud prevention becomes a priority as automation enforces adherence to approval workflows and prevents payments from being authorized by the same individual who initiated them. With an automated process, businesses can rest assured that their AP data is secure, compliant, and protected against potential threats.
9. Tailored Payment Options
The flexibility to pay through the vendor’s preferred method, whether it’s ACH, wire transfer, credit card, or any other specified choice, guarantees streamlined transactions. This tailored approach not only enhances the efficiency of the payment process but also strengthens positive vendor relationships.
The shift towards automating accounts payable processes is not merely a trend; it’s a strategic move for businesses aiming to thrive in the evolving landscape of finance and efficiency. Fast-track invoicing, approvals & payments with end-to-end Automation!
Published on: 23 January 2024
John Bugh is Chief Revenue Officer for PathQuest, responsible for the strategic direction, planning, vision, growth, and performance of the company’s marketing, branding, and revenue streams.
As a seasoned professional with over 35 years of experience in executive sales, marketing, and operational leadership, John has worked to build high-performing leadership-teams that have a demonstrated track record of accelerating growth, increasing revenue, establishing sustainability, and improving profitability.
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