How AP Payments Solutions Enhance Supplier Relationships
Recently, striking developments have made companies and businesses realize the power of accounts payable automation solutions. These solutions are technologically driven and make life a whole lot easier for AP departments during the payments process. Furthermore, the relationship that exists between the company and its suppliers is improved and enhanced as a result of these technologically based solutions that create efficiencies in the AP payment procedures and processes.
In this piece, we will explore ways in which automation driven AP payment solutions enhance your supplier relationships. The various improvements that these payments solutions create for supplier and supplier relationships are highlighted below.
One sure and apparent improvement that these automated AP payments solutions have sought to bring is the elimination of delayed payments to suppliers and suppliers by companies. It facilitates swift payments, helping build improved trust between the two parties. This serves as the bedrock of a sustainable relationship between the company and the supplier.
Manual processes associated with traditional payment methods and procedures can be arduous, overloading typical AP departments with inbound inquiries, error handling, etc. — often leaving staff members overwhelmed. This can lead to AP staff members being overwhelmed, often breeding even bigger issues like late or missed payments. Issues like these have the compounding effects of demoralizing over-worked staff and damaging key relationships with your suppliers to the point of losing suppliers and creating more work in procuring replacement suppliers.
All these problems are alleviated by AP payments solutions. First, with these solutions and services, payments are not facilitated manually but electronically on a cloud-based platform. This makes access to this information faster for all parties involved, whether it’s the CFO analyzing a given month’s cashflow or an AP manager tracking down a specific payment. These AP payments solutions and services facilitate the payment on your behalf — paying to the correct supplier on time. This consistent and effortless timeliness of payment further enhances trust between the parties, helping gain the company’s integrity for future transactions while improving the health of their cashflow — all contributing to the overall health of your supply chain.
Another enhancement brought to the company-supplier relationship is that of transparency. These AP payments solutions and services create vital transparency for both parties, helping to show where and when payments may have been delayed or simply shed light on where a payment is at a given moment. Such visibility and transparency allows for easy identification of bottlenecks during the payment process, enabling quicker remediation of issues, and ultimately, an optimized AP process.
The supplier, on the other hand, also gains valuable insights into payments statuses, going above and beyond the typical buyer-supplier relationship, also leading to a reduction in unnecessary communication between the parties.
With the traditionally included activities erased from the company’s payments systems by automated solutions, the accounts payable teams’ productivity drastically increases. Having to deal with manual labor and procedures associated with traditional AP payments processes such as mailing paper checks and remitting payments are often over-burdensome for AP departments — with services like those provided by Finexio, those labors can be decreased or even eliminated altogether, freeing time for your team to spend on more value-add activities.
These solutions drastically reduce jams associated with manual payment procedures such as payment approval, data entry, and payment tracking and remittance. Overall, leveraging these solutions and digitizing accounts payable payments brings ease to financial operations.
Leaning on traditional AP payments such as paper checks creates an over-dependence on long trails of mail, creating unnecessary and irritating delays in communication between buyers and suppliers. This dependence on an inconsistent system can lead to issues like late or missing payments, contributing to frayed supplier relationships. However, the aforementioned AP payments solutions grant all parties involved in payments access to the real-time payments tracking that accompanies electronic payment methods like virtual card and ACH.
Access to real-time reports for both the buyer and supplier helps to maintain consistent visibility into payments between the two parties, having the mutually beneficial effect of reducing needed communication between the parties, for issues such as late payments, incorrect amounts, etc. Rather than creating a chain of emails associated with any particular payments issue, however minuscule or otherwise, errors and questions can be handled with the click of a mouse as soon as their identified.
Meanwhile, the supplier can more consistently know when they will receive payment, seeing the progress of payments with the accompanying reports. This is a significant relief in the communication load as these stressful processes that ordinarily would have created gaps in the payment process are reduced and the buyer-supplier relationship becomes smoother overall.
Another important way AP payments solutions enhance supplier relationships is the contribution it makes toward the building up the overall relationship. With more consistent, transparent, and dependable payments between a buyer and supplier comes invaluable trust, helping create a deepened partnership. That combination lends to the possibility of negotiations of improved payments terms as supplier’s trust and value in your business arrangement grows, further improving your company’s cashflow and overall business health.
For companies across the country, especially as they deal with the cash strapping post-COVID world, taking advantage of AP payments solutions can be a valuable yet straightforward business solution. Such solutions will, as explained above, help businesses enhance their productivity, and reduce stressful analog and manual procedures. This is indeed smart work.