AP automation is a huge topic for B2B business owners as B2B payments increase to $120 trillion per year, according to this article from PMYNTS. One study found that 25% of B2B payments still rely on paper checks, which causes several issues for all parties involved. When relying on paper checks and manual calculations, you increase the risk of error and losing out on new and current customers.
Although AP automation is still a newer topic in the B2B space, there are many FinTech companies that help accounting teams save time, decrease costs, and increase accuracy. Plus, at my company, Richmond Financial Services, I provide consulting services to make all things related to payment processing in the oil and propane industry run smoother. I can help you create a payment plan for your business that helps you save time and money. Follow these three tips for AP automation:
Find the Right Digitized Solution
The first step toward AP automation is finding the right digitized solution that works for you and your employees. Depending on the solution you choose, you may be able to receive a trial run of the service free or at a reduced cost.
Successful businesses in the U.S. and the U.K. are doing just this due to half the value of all U.K. B2B sales being overdue in the past year and 8% written off as uncollectible. 36% of U.K. businesses also predict it to take longer to collect payments, and 39% anticipate the average day sales outstanding will increase.
Increase Fraud Prevention
Fraud is a major cause of revenue loss each year, and business owners are working actively toward decreasing fraud. Completely automating AP processes eliminates the risk of most types of fraud. This is because the authorized payment is only distributed to the bank account of the registered supplier based on the validity of the invoice, according to USA Wire.
The payment is also validated because it’s matched against the PO and GR to ensure that all details are accurate.
Scale Your Business
When you find the AP automation solution, you give yourself the freedom to scale your business without having to worry about hiring unnecessary personnel. As you increase your business contacts and networking efforts, you’ll naturally have more customers and invoices to manage. Planning ahead and utilizing FinTech decreases stress and saves you precious time and money.
I hope you find these tips useful and will seriously consider AP automation. Good luck!
