Not paying suppliers can do more than cause bottlenecks with goods and services. Businesses can find themselves cut off and even blacklisted from suppliers.
Sure, you can always hunt down another third-party vendor, but there’s a good chance you’ll run into problems if your company’s payment record isn’t the best. Your accounts payable team is doing their best, but things are obviously falling through the cracks. You need AP software, and there’s more than one option.
Going through an accounts payable automation software comparison can make it easier to find the best product for your company. Not sure if AP software is worth the relatively affordable cost? Maybe a look at some of the benefits can help convince you that the software is a necessary business investment.
The Key Benefits of AP Software for Businesses
The benefits of accounts payable software aren’t only limited to real-world applications. You can also see positive bottom line improvements.
Tackle Issues with Human Accuracy
Human error is one of the costliest problems associated with processing invoices manually. When you have clerks opening envelopes and typing invoice information into computer systems by hand, errors are inevitable. These errors can come from outside your business or within other departments, too.
Automating your process with tools that intelligently capture the information presented on invoices not only speeds up the initial phase of AP processing but also reduces errors that cost you money at the same time.
Improve Time Efficiency
Invoice cycle time is often also a casualty of manual processes. Your business needs to pay invoices on time to keep its cash flow as liquid as possible without violating vendor invoice agreements. Reconciling the appropriate timing of these events can be tough, if not impossible, when your AP processes are mostly manual.
An automated system can balance these concerns for you and reduce the amount of time each invoice remains pending on your books. From intake to the approval process, fewer touches translate into faster handling. You can configure such an automated system to hold invoices for payment until the ideal moment.
Teamwork Increase
When tensions run high in the office because of too much work and too few hands to do it all, morale suffers and productivity drops. Automation can put the spark of life back into your department by eliminating the most troublesome, time-consuming, and tedious tasks.
If your team isn’t wasting hours on portions of the job they strongly dislike, they can focus their efforts on the most critical parts of the process. AP software enables teams to work together more effectively by consolidating many workflows into one.
Boost Vendor Satisfaction
The benefits of using accounts payable automation aren’t only internal. It’s essential to consider the impact on your vendors, too. When you spend less time on manual data entry and matching invoices, you’re able to capture vendor-provided early payment discounts.
Consistently on-time payments that always arrive smoothly can mark your business as a preferred partner for many vendors. When you need assistance in a pinch, that good reputation can be beneficial.
Integrates Easily With the Rest of Your Business
AP has traditionally been a highly siloed environment, with information passing to it from other departments but rarely the other way around. Integration with SAP, NetSuite, Microsoft Dynamics, and enterprise resource management software generally makes the AP process visible to the key decision makers and players within the company. As a result, AP software becomes a value creator, not just another cog in the machine.
Streamline Your Business Processes
Consolidating workflows does more than improve opportunities for excellent teamwork. Automation software also gives you the flexibility to design and implement workflows that align with the specific needs of your industry.
The customizable nature of most automation tools means you can design processes that conform to your institutional requirements. One of the critical benefits of AP automation is its flexibility and adaptability.
Increase Your Business’s Data Visibility and Improve Insights
At the same time that automation simplifies the compliance process, it also unlocks fresh insights for the business. When you leave manual processing behind, you can use systems that generate data-rich reports about how your AP team performs.
When assessing KPIs is easy, you can see what works, what doesn’t, and where additional training or technical assistance may be necessary. Better data analysis also leads to creating cash flow and purchasing insights that may prove useful for management teams.
Avoid Compliance Issues and Boost Monitoring
An audit trail that is easy to follow for any transaction is an essential feature of a successful AP department. Ensuring that your team follows the correct approval process and pays only legitimate invoices is a critical task. Otherwise, you put yourself at risk for fraud from both inside and outside the company.
Automated systems generate immutable records of every action taken on an invoice, including who handled it, when each part of the process occurred, and more. Having this data at your fingertips turns compliance and monitoring from a headache into a solution.
Noticeable Cost Savings
The cost per invoice processed is a critical KPI for your business. With manual processes, each invoice could cost $10 or more to process, especially when there are errors or exceptions to resolve. It could make AP a drain on the business’s finances rather than a boon for the bottom line.
By automating more of the process, the cost per invoice can drop dramatically. Many invoices could undergo processing and approval with very few human touches, lowering the cost to process each item by an amount that yields noticeable financial benefits for the business. Conducting a cost-benefit analysis on automation may reveal it’s a “no brainer” choice for AP departments struggling with high volume.
Accounts Payable Automation Software Gives Businesses the Chance to Grow
Automation can seem like a “set it and forget it” investment, but the reality is different. Automation tools can grow with your business while letting you monitor the effectiveness of your efforts. As time goes on and technology improves, you can automate additional elements of the process.
The data provided to you also offers insights that make planning for the business’s next growth phase easier, so you’re ready for whatever the future brings.
