In today’s business environment when enterprises are at a tight-edged competition, the need to do more with less has become the highest thought of strategies. Each business aims at yielding maximum ROI with the least minimum investment (accounts payable) they can do.
To free up the working capital one can take numerous steps, but today we will focus on strategizing Accounts Payable Process Improvement ideas to free up some extra working capital.
Do you know high accounts payable reflect greater liabilities on the business? An average of 48% of businesses tends to make 68% fewer profits because almost 62 per cent of their ROI go to the unattended accounts payable, as per studies.
You must be wondering where your accounts payable management went wrong when it seems to be carefully managed? Here are the common mistakes you must be committing unintentionally in your accounts payable management:
- Failing to issue purchase orders.
- Not consciously matching delivered items with contractual terms.
- Lack of visibility into vendor payments
- Lack of operational efficiencies in accounts payable management.
Here are the steps you can follow for accounts payable process improvement:
#Tip 1: Centralize Accounts Payable Process Management:
- Eliminate paper invoices and accept only online invoices.
- Integrate into your system invoicing and accounts payable software to eliminate piles of paper and centralize payable management. This simple integration will increase visibility into entire accounts receivable and accounts payable management for your business.
#Tip 2: Take the leap towards paper-less invoicing solutions:
- Opt for a centralized scanning solution for vendors who do not supply electronic invoices. This would help to turn images into computer-readable text.
- Perform all the data entries and functions (online & offline) automatically with Invoicera to improve your AP process.
#Tip 3: Streamline workflow with the automation of Approval
- Quickly approve/get approved received invoices to streamline payments. Quick approvals and payments avoid late payments.
- Manage approval assignments, general ledger posting, workflow, approval and review or notifications.
#Tip 4: Adopt more robust governance practices
- Organize the functions with a standardized and streamlined accounts payable process.
- Receive accurate payments much more quickly.
#Tip 5: Set up payable reminders
Always take a proactive approach in managing accounts payable. Forgetting information and tasks is a very common human tendency. By setting up reminders one can easily take care of bills and take steps towards accounts payable process(ap process) improvement.
Reminders help you anticipate expenses. Use Invoicera to manage invoice due dates and set up alerts that automatically let you know when a due date is approaching.
#Tip 6: Consciously budget your expenses
Proactively creating business budgets can help you improve the AP process and avoid late payments. Use your account payables sheet in the dashboard to keep yourself updated about all the bills that you need to pay. A clear record of every penny that needs to be paid makes sure you don’t spend extra on late payments and fines.
#Tip 7: Strategize to expand your cash reserves
It is not always a happy day for business. You might have to face some slow days too. In the days when your cash flow is a little too slow, you might need to open your bags of cash reserve and make keep your AP process on track.
List of the ideas for accounts payable process(ap process) improvement for invoice processing are summarized below:
- Avoid vendor going into a debit balance.
- Set a checklist to track the recurring invoices.
- Send certain processes to a strategic offshore partner. This might reduce cycle time, errors and costs and also strengthen the internal controls.
- Pay invoices according to vendor terms.
- Reduce the time to handle an invoice.
- Eliminate the type of floating invoices and target to send AP first.
Similarly, improvement is needed for the AP process for different sections in payments, travel, and entertainment, technology, analysis, and planning, cost control, working with purchasing, staff management, and customer relations.
- Accounts payable process(ap process) improvement can eliminate manual check requests from the payroll.
- Improve vendor relationships and cut costs by sending payments online
- Stretch payment dates to quarterly
- Upgrade AP systems functionality
- Get a system that calculates due dates
- Eliminate file cabinets and route electronically
- Develop more usable reports with a definite team
Take a look at the definite improvements made in the account payable process. The relative improvements can be made in indefinite areas for the perfect workflow.
In The End
Out of cluttered clouds, your mind is now free to think about the best possible ways for you to manage accounts payables. Invoicera with its artificial intelligence ensures smoother Accounts payable management and tracking. A quick sneak peeks into how Invoicera, the accounts payable management software makes management easy:
- Eliminate excessive data entry into accounts payable process improvement(ap process).
- View the progress of invoices with an easy reduction of time.
- It provides centralized access to invoice data.
- Get faster automation of approvals.
- Match with the relevant documents.
- Avail 24*7 customer service for a convenient solution online.
TRUST INVOICERA FOR ALL YOUR ACCOUNTS PAYABLE PROCESS REQUIREMENTS:
Invoicera is one of the most powerful accounts payable management software. With more than 16 years in the online invoicing industry, it has been serving more than 3 million businesses. Supported by almost every industry, Invoicera has its customized set of tools for small businesses, enterprises, and freelancers. The support of more than 30 online payment gateways in the software makes it unique and more reliable for businesses commencing their activities worldwide. The mega dashboard in Invoicera enables you to have an efficient accounts payable process for effective management of accounts payable. CUSTOMISE, CREATE AN INVOICE ON THE GO WITH INVOICERA’S MOBILE APP AVAILABLE FOR BOTH ANDROID AND IOS.
Frequently Asked Questions
Ques: What are the Accounts Payables?
Ans: Accounts payables are the short term liabilities a company owns after the purchase of goods and services in the business. AP is generally recorded in the business under short term liabilities of the balance sheet.
Ques: How can I improve the accounts payable process?
Ans: Cash flow is directly proportional to accounts payable in the business.Thus, the need to manage AP is utmost important for the business. Here are some of the tips on how you can improve AP process of your business.
- Accept online invoices
- Centralize effective data and eliminate data entry
- Streamline workflow with automation
- To simplify and standardize
- Set up reminders
- Budget your expenses
- Expand your cash reserve
Ques: How Invoicera helps in improving the AP process?
Ans: The cloud-based accounts payable software lets you create an expense management sheet online and record every payable. An online created sheet automates the AP process. It notifies you each time of due date, filters out paid and unpaid accounts payables, calculates total liabilities and keeps you updated.