Are you losing your key vendors due to an inadequate tracking system to record payment due dates? Do you think that you cannot take advantage of the benefits offered by the providers in terms of discounts offered for prepayment?
If these are common problems that you face, you should definitely review your accounts payable system. Debts to pay it is an integral part of your working capital, and failure to address these issues could result in ongoing cash flow problems. With poor supplier relationships, your production and profits will be severely affected. You must act immediately.
Manual systems of maintaining accounts payable records in the event of an expanding business will result in missing supplier payment terms, supplier discounts, loss of control over the quality of supplies, and ultimately a financial crisis for the company. company.
How can accounts payable be optimized?
These are some of the ways that accounts payable process can be optimized.
Preparation of a core strategy
You must decide the frequency of payments to providers, including the method of payment, taking into account the due dates.
The accounts payable system should also include the approval process. Discounts offered by vendors and maintaining proper long-term vendor relationships should be considered.
The system must be integrated with the company’s MIS reports so that management can make critical decisions.
The responsibility for monitoring accounts payable should be entrusted to a key decision maker in your management team. Since the management team is responsible for ensuring that no opportunities are missed in terms of competitive credit terms, they will keep track of vendor payment schedules.
Managers must adhere to the accounts payable strategy to obtain optimal benefits.
The analysis of accounts payable should be part of the main agenda of business meetings, and there should be smooth access to the computer network from any geographic location with mobile devices.
Integration of providers
Having a centralized supplier portal linking your inventory network to your key suppliers makes it easy to monitor bulk purchases. Negotiating the best price with your vendors with the proper accounts payable process in place becomes fluid and fluid.
Your suppliers can access inventory supplied by them, restock if necessary, and receive automated payments.
Suppliers receive their quotas on time and there is never a shortage of inventory with a proper system.
Minimize errors and fraud
An efficient accounts payable system ensures that there are no losses due to fraud or errors. Losses due to such errors run into the billions of dollars.
With automation, detecting fraud and accounting errors is easier.
There must be more than one authorized signatory when it comes to sanctioning payments made to providers. Automation also ensures that payments are routed through a secure payment network that prevents access to your company’s financial information.
Your accounts payable should also be audited at regular intervals to assess the effectiveness of your accounts payable and rectify any errors at an early stage.
Get professional help for your accounts payable
If you want to focus on income from your business and acquiring new clients for higher profits, let professional firms manage your accounts payable system. At OHI we have several years of experience in managing accounts payable processes in all industries. We have handled end-to-end AP (Procure to Pay Cycle) processes, including PO creation, invoice processing, vendor reconciliation, AP reporting, and AP disbursements.
You won’t have to invest a lot in staff, as we (OHI) will take care of the entire accounts payable process, from tracking supplies to ensuring timely payment from suppliers. You’ll enjoy the benefits of a smooth flow of inventory and supplier discounts.
We can maintain all audit-related accounts payable requirements. At OHI we have experience in different software such as QuickBooks, Yardi, Appfolio, NetSuite and Xero. OHI has clients in various sectors such as real estate, construction, IT, logistics and transportation, and retail sectors. Most of our operational team is at least four years old. accounts payable outsourcing experience.
So, look for accounting and finance companies that can provide multiple client references, and find one that fits your budget. With the right company, your business will grow to the next level and your profits will skyrocket.
LAST is a specialized accounting and financial outsourcing service provider since 2006, providing qualified and experienced accounts payable specialists at affordable rates. Great experience in QuickBooks, Xero, NetSute, Yardi (Genesis and Voyager), AppFolio, Timberline and Microsoft Dynamics. Our services are used by more than 300 companies in sectors such as real estate, construction, logistics and transportation, retail, manufacturing, IT companies and CPA companies.
We invite you to experience finance and accounting outsourcing through us. Contact us to develop a custom accounts payable process manual tailored to your business needs and requirements.