No matter the size of the company or industry, limited time and resources is a common refrain among accounts payable (AP) departments. The day-to-day operations are complex; whether it’s managing payment terms with vendors, billing customers, or simply writing checks, there is never a lack of things to do.
In their 2021 annual survey of AP professionals, Ardent Partners, a research and advisory firm focused on supply chain and AP processes, finds among respondents:
- 60 percent say invoice/payment approvals take too long
- 48 percent report high percentage of exceptions
- Staff is spending 22 percent of their time handling supplier exceptions and inquiries
The same survey respondents cite their largest payment challenges as:
- Processing manual checks (cost and time)
- Managing vendor payment/banking details
- Gaining timely approval of invoice and payments
More specifically, the data shows business conditions have caused costs and inefficiencies to rise substantially within businesses.
- Average cost of processing a single invoice increased by eight percent during 2020 to $10.89; the first increase in cost in more than 13 years of this survey.
- Time to process a single invoice (receipt to “ready-to-pay”) is now 10 days, up from 8.3 days in early 2020.
- 24.6 percent of invoices were flagged for exception handling by AP staff.
- Increased use of “gig” workers during the pandemic increased AP workload with 43.5 percent of “non-employee” labor being paid through AP and not HR payroll.
Beyond the internal organizational issues caused by the extra time and expense, the inefficiency can lead to strained relationships with suppliers and threaten the health of your supply chain.
Solutions for Efficiency and Cost Savings
Automating your AP processes is key to keeping your payables running smoothly and saving money (all while keeping your suppliers happy). Systems that require the lightest touch from your staff will be the most efficient and help you make the most of your valuable resources. A successful AP automation implementation will help your business:
- Eliminate data entry,
- Enable online approvals,
- Generate digital audit trails,
- Match invoices to POs and payments,
- Enable secure, end-to-end payments, and
- Reduce errors such as duplicate payments.
LSQ FastTrack® helps businesses do many of those things (in addition to providing working capital solutions for you and your suppliers).
Our quick and easy platform has automated features, like total payments management, as well as integrations with numerous AP management and ERP systems.
LSQ FastTrack total payments management intelligently routes payments to where they need to go, and when they need to get there. For example, when a supplier requests an early payment, LSQ uses our own funding sources to pay that invoice (or invoices) at the requested early payment date. FastTrack will then route buyer funds to LSQ at maturation of that supplier’s terms.
On the other hand, for invoices not paid early, the LSQ platform will route payments to the supplier from a for-benefit-of (FBO) account at the maturation of that supplier’s terms.
All without day-to-day input from the buyer or commitment of technical resources.
LSQ FastTrack is the only platform in the market that provides a total payment management solution along with working capital funding.
FastTrack’s powerful integrations and embedded finance capabilities with ERP systems and other automation solutions are also a resource saver for AP departments. Most notable among these integrations is our partnership with Esker. The LSQ FastTrack extension expands the capabilities of the AP automation solution Esker Pay to help businesses optimize cash flow and deliver on-demand supplier early payments – all within one platform.
Reducing friction is key to running an efficient AP department; manual processes are the antithesis of achieving that goal. With LSQ FastTrack, you can gain control over your AP costs, while freeing up valuable time and money to focus on more strategic initiatives.