By now you’ve probably heard about accounts payable (AP) automation, but you might be wondering if it can really have a significant impact on your business. There are many reasons that companies choose invoice automation, but savings is usually at the top of the list. An ideal platform saves both time and money. It’s crucial to use both as efficiently as possible to create the biggest impact. That’s where invoice automation shines. Invoice automation can make improvements that reverberate throughout your organization. Here’s where most companies reap time and money savings with these solutions:
Removing paper from your AP processes
We’re not saying you’ll never need paper again, but in the simplest terms, automation replaces your paper-based processes with electronic ones. Invoices that aren’t received electronically are scanned and uploaded to a cloud-based platform where employees can access them anytime. Approvals are done through workflows, rather than piled on someone’s desk. All tracking and past records are online, saving time spent researching and searching through old files.
Eliminating repetitive, manual tasks
Especially those having to do with paper – opening mail, verifying invoices, entering them into an accounting system, getting signatures, printing checks, stuffing envelopes, paying postage, filing, and storing records – can all be reduced (or completely eliminated) by automation.
Invoice automation leaves less room for human error. Fewer mistakes means less time spent researching, less time working the invoice through the payment process, and less time on the phone with suppliers for corrections. It also allows companies to utilize fraud prevention tools more effectively.
Fewer employee hours required
When an AP department reaches capacity, forward-thinking companies invest in automation instead of hiring additional full-time employees. Automation comes with scalable processes that can accommodate more invoices faster, creating the opportunity for payment discounts and freeing employees’ attention for more strategic tasks.
Time for more impactful work
Rather than spending half a day opening mail and sorting through invoices, AP employees can spend their time making a bigger organizational impact. Whether they secure more supplier discounts or stay vigilant against fraud, employees can make considerable improvements to their department when given the time and tools to be successful.
Decreased paper storage costs
Companies with paper records need to handle countless logistics. Over time, they run out of space and need to add more filing cabinets. Once those are full, they must move files to a new location, whether onsite or offsite. After so many years, they need to discard old records and pay employees for the manual labor of that task. Some even pay a third-party to store their paper records, adding to their operating expenses. Automation eliminates a large amount of paper, decreasing the amount of time and money needed for simple storage solutions.
Automation platforms provide easy-to-measure ROI and implementation requires little-to-no IT resources. It’s easy to justify the change, especially for overwhelmed AP departments. The ROI can be measured easily through:
- Cost per invoice
- Payment accuracy rate
- Days payables outstanding (DPO)
- Number of invoices paid on time
- Early payment discount capture rate
- Amount of supplier inquiries
- Time spent on supplier inquiries and disputes
- Time reviewing past payments for auditing or other purposes
- Printing and paper storage costs
About CommercePayments® AP Invoice Automation
Invoice automation can include everything from invoice reception to storage – electronically. This level of automation has a much bigger impact on your business, even outside of the AP department. Employee work hours, paper printing and physical storage costs, and time spent auditing are all significantly reduced. And when one of your employees goes on vacation, it’s still business as usual. Transitioning from manual to automated accounts payable can play a vital role in turning your Accounts Payable department into a profit center.
At Commerce Bank we look at challenges as opportunities to innovate and at disruption as a chance to uncover new ways to add value. We value long-term relationships and are ready to take on challenges and opportunities together and strive to know your business and offer creative solutions to the challenges you face every day. Learn more at commercebank.com/BuiltForBusiness.