Not even the most doomsday prophesying economists could have predicted the extent nor the speed with which commerce has dried up over the past two months. For finance and AP teams, this has led to a sudden need to reassess vendor payment strategies, in order to optimise cash reserves.
In fact, according to a recent survey that we conducted of more than 500 finance professionals, more than 40% said that they plan to either stop or slow down vendor payments during the pandemic.
At the other end of the spectrum, organisations which are more cash-rich are able to leverage programs like early payment discounts. These provide both a healthy return for the buyer (the equivalent of 37%, based on 2/10 net 30 discount terms) and also get cash to vendors more quickly, helping support the supply chain.
Both of these initiatives require accurate and timely insight into spend, as well as the ability to effectively manage the invoice approval workflow. Organisations that rely on manual processes to manage AP processes face major challenges in achieving visibility into the vendor payments process. Paper invoices can get delayed or lost, slowing down approvals. Mistakes such as data keying errors or invoice miscategorisation can lead to an inaccurate view of spend. Transaction data stored on spreadsheets can be almost impossible to analyse in a timely manner, reducing the potential for finance teams to negotiate volume discounts or identify pockets of wasteful spending.
The first step to enhancing an organisation’s ability to optimise its spend processes is automating the AP process. By leveraging sophisticated optical character recognition capabilities, finance teams can speed up the approval process and cut rekeying mistakes. Electronic and digitised invoices pass through rules-based workflows, which automatically route approvals based on pre-configured criteria. POs and shipping documents can be automatically matched with invoices, to both eliminate fraud and increase efficiency.
Where the benefits of automation can have a real impact on spend optimisation is the ability to analyse large and complex data sets in a timely manner. Is there a pattern of approval roadblocks or bottlenecks which are preventing us from securing early payment discounts? Can we change the order of vendor payments to maximise cash on hand? Can we combine a merchant’s spend from across multiple departments to secure a volume discount?
Organisations that use Chrome River INVOICE to automate their AP process can dramatically cut down the invoice approval time, as well as slash the amount of human input required to input and process invoices. Combining this with the Emburse Insight Advisor consulting service can enable finance teams to provide powerful business intelligence and reporting capabilities to maximise your spend data and gain unique insights into your travel, expense and accounts payable spending patterns.
To learn more about the benefits of automating your organisation’s AP process with Chrome River INVOICE, schedule a free demo today.
- IDC Recognises Chrome River as a Leader in Enterprise AP Automation Solutions
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- Gartner and Ardent Partners Advise How to Build a Best-in-class Accounts Payable Operation
- When Cash (Control) is King: Is Your Accounts Payable Strategy Optimised for a COVID-19 World?
- Getting the Most Out of Your Spend Data with Emburse Insight Advisor
Our choice of Chrome River EXPENSE was made in part due to the very user-friendly interface, easy configurability, and the clear commitment to impactful customer service – all aspects in which Chrome River was the clear winner. While Chrome River is not as large as some of the other vendors we considered, we found that to be a benefit and our due diligence showed that it could support us as well as any large players in the space, along with a personalized level of customer care.
We are excited to be able to enforce much more stringent compliance to our expense guidelines and significantly enhance our expense reporting and analytics. By automating these processes, we will be able to free up AP time formerly spent on manual administrative tasks, and enhance the role by being much more strategic.