Trends for Implementing a Successful Electronic Payment Strategy
The accounting industry as a whole is not known to embrace rapid change. This would explain why so many businesses still exclusively use paper checks to pay their suppliers. Things are changing slowly, however.
Businesses are discovering that there are many benefits to using electronic payments, which are faster, more secure, and can save businesses money.
The task of implementing an electronic invoicing system may seem daunting to a business that heavily relies on paper checks. However, it’s not as hard as you think. Keep these three components in mind when you start the switch to an e-payment system.
Start With the Biggest Vendor
Accounting departments in old-school companies may often need to convince upper management of the benefits an electronic payment strategy can bring. Oftentimes, management will want cold, hard numbers as to how much money can actually be saved by implementing an electronic payment solution.
While calculating labor hours that may be saved can be a bit arbitrary, the dynamic discounts that your company can take advantage of by paying early will give upper management some of the actual numbers that they need.
The easiest way to this is by starting with the largest vendor. There are several reasons for this:
- You are probably one of your vendor’s best customers. Convincing them to accept electronic payments should be no problem.
- Multiple invoices can be paid to one vendor in a single electronic payment.
- The dynamic discount that you are able to take will have the biggest impact if you start with the biggest vendor.
By taking small strides and presenting the benefits an e-payment strategy can bring the company, upper management will be on board in no time.
Once you get the green light from upper management to proceed with an e-payment strategy, there is the task of getting your staff involved.
Accounting staff know exactly how long it takes to process and pay invoices. More invoices mean job security, of course. By telling them that you are making the switch to an electronic payment system without involving them could make them worry. Some staff may feel that their job is on the line and could subconsciously sabotage an e-payment implementation by offering excuses as to why it won’t work.
One way to ensure that this does not happen is by including staff in the process and asking for feedback along the way. Be open and honest about the time and money an electronic payment system will save the company. However, you can also assure them that their services can be used in other areas of the accounting department or company overall. Many accounting personnel, who have been doing the same work for years, will most likely jump at the chance to learn something new and grow in their career. Engaging AP staff is a key component to a successful e-payment strategy.
Use the Right Technology
If your business relies mostly on paper checks with only the occasional wire or ACH payment, it’s time to look into other solutions. Not only is it time consuming to pay invoices this way, there is also more room for error.
When looking to implement an e-payment strategy, you want to look for a solution that can integrate AP entries with a variety of electronic payment options. You also want to choose the technology that will make payments easy for recurring monthly vendors.
For example, AP automation enables businesses not only to streamline their e-payment processes, but get rid of paper invoices in the meantime, saving the company more time and money. Accounting managers that do their homework will find that there are a variety of solutions available out there to make their jobs easier, as well as become a key contributor to their company’s growth.