Consider, struggling for countless hours on a jigsaw puzzle. Suddenly, you adjust the last piece snugly to get the perfect box image. The feeling when you just sit back to admire your work and that sense of accomplishment can only come with a job well done.
Now, imagine feeling that way about your ongoing accounts payable (AP) automation challenges – envision automation spanning the entire invoice handling process from receipt to processing all the way through payment. It’s possible with payment automation.
5 Reasons to Digitize & Automate Accounts Payable
Improving financial efficiency and cash flow can be a daunting task in the corporate world. Managing such complex processes presents significant challenges, but taking the step to automate accounts payable can help.
Before the integration of AP automation into your processes, you’re likely to face a few common challenges including:
- Removing paper and manual effort
- Paying vendors on time
- Managing cash flow
AP automation creates a better link between your purchase-to-pay system and your vendor relationship and increases your automation levels, which extends five major benefits:
1. Faster Cycle Times
For AP teams, time is literally money. The more automated and efficient the AP process is, the more return the company will see on their investment and the faster suppliers will get paid.
This also means cost savings from faster invoice processing and capturing more early payment discounts.
2. Reduced Errors & Duplicate Payments
Errors in the AP process eat up valuable time, erode supplier relationships, and can result in duplicate payments. Payment errors strike even the most diligent and automated accounts payable departments. It reflects poorly on your company, however, even in cases of small errors or well-intentioned accidents.
AP automation solution can automatically classify invoices and receipts to the right account, then input detailed information into an account ledger that can be referenced later. They automatically flag or even reject vendor statements with duplicate invoice numbers. They code invoices immediately into any account-specific files and make sure those files are accessible to appropriate AP employees.
3. Increased Visibility
With automating your accounts payable, you can capture more financial data to support advanced analytics and process improvement.
- Accounts Payable becomes a strategic focus area to help finance executives better understand, predict, and forecast their invoice payment flow. This visibility also opens the door for strategic tools that optimize invoice payment position, like supply chain financing and dynamic discounting.
- Automating the payment process enables organizations to provide suppliers with real-time visibility into transaction statuses, via a portal, thereby reducing time spent on fielding supplier inquiries and improving supplier relations.
4. Additional Discounts
Lengthy processing cycles are the primary reason for missed early payment discounts.AP automation can compress the processing cycle and enable organizations to capture more of the discounts available to them, optimizing their working capital.
With AP automation solutions like Aavenir Invoiceflow, you can automate invoice data entry, invoice approval, and invoice payment reducing your AP department work time by 80%. This video explains how Aavenir Invoiceflow can help the Accounts Payable team to process thousands of invoices in minutes and track payments to foster vendor relationships.
5. Increased Supplier Satisfaction
Automating accounts payable processing results in shorter payment cycles, which means that suppliers get paid faster and can decrease their days' sales outstanding (DSO). This goes a long way in improving relationships with the supplier base.
AP automation enables your vendors to submit and track invoice receipts instead of emailing, communicate instantly with the team and receive automated payments. Vendors can get discounts by setting up rate contracts and can track statuses of deliveries in a single workflow.
Ready to Learn More?
Aavenir’s smart AP Automation software solution uses the most advanced Artificial Intelligence technology that learns an organization’s invoices' unique patterns to simplify invoice coding, ensure data accuracy, identifies duplicates, and more. Built on the Now platform®, Aavenir Invoiceflow offers an easily configurable approval workflow that brings the AP team and non-accounting team on the same platform to expedite the AP process and save the cost of PO/non-PO invoice processing.
Few benefits of end-to-end accounts payable automation are well established:
- Faster Invoice processing
- Reduced costs
- Greater process transparency
- Strengthened internal financial controls
- Lower error rates
- Enhanced cash management