Does My Business Need an Accounts Payable System?
Smart Systems for Maximum Profitability
Welcome to our blog series on Smart Systems for Maximum Profitability where we explore the latest trends and technologies that help businesses like yours achieve maximum profitability.
Are you feeling overwhelmed with your business paperwork and the pile of bills that never seem to go away? Whether you’re a new entrepreneur or an established business owner, managing invoices and paying bills can be incredibly time-consuming. Here are a few reasons why a designated Accounts Payable System is way better than that tired old Excel spreadsheet or accounting software that you've been using.
What is an Accounts Payable System?
An accounts payable system is basically a software or program that helps businesses manage their finances more efficiently by automating the process of paying invoices and bills. While you’ll need to set up the initial sorting systems, once that’s done the bills practically pay themselves.
How Does An Accounts Payable System Save Me Money?
Are you looking for ways to cut costs and increase your bottom line? Of course, you are. Aren’t we all? One of the quickest ways to do that is to implement an efficient accounts payable system.
By automating the payment process, you can reduce the risk of errors and fraud, save time on manual tasks, and negotiate better payment terms with your vendors. Plus, with real-time visibility into your cash flow and expenses, you can make data-driven decisions to optimize your spending and minimize waste. Best of all, with fewer late fees and penalties, you'll be able to keep more money in your pocket. Trust us, an accounts payable system is a smart investment that will pay dividends in the long run.
How Does An Accounts Payable System Prevent Fraud?
With reputable Accounts Payable software, you can safeguard against potential scammers by having dual controls in place with separate team members responsible for both approving invoices and processing payments. That way everyone stays informed of the agreed-upon price before funds are exchanged. Your AP system gives you the peace of mind that every invoice is 100% legit.
Common Mistakes People Make When Setting Up An Accounts Payable System
If you're setting up an accounts payable system for the first time, there are a few common mistakes you'll want to avoid to make sure everything runs smoothly. One of the biggest mistakes you can make is not properly organizing and categorizing your expenses. Without clear labels and categories, it can cost you money. You might end up paying more in taxes or you may not be making as much money as you think you are so it’s important to make sure you are coding things correctly within your Accounts Payable process.
Another mistake to watch out for is not properly backing up your data. Accidents happen, and if you lose all your information because you didn't have a backup in place, it can be a huge setback.
Finally, make sure you're choosing the right software for your needs. Not all systems are created equal, so take the time to do some research and make sure you're selecting the one that's best for your business. At Oracle Profitability, we highly recommend Bill.com. They claim to cut your Accounts Payable time in half!
One More Way You Can Save Money By Setting Up An Accounts Payable System
Have you ever heard of early cash payment discounts? It's a win-win situation for both the buyer and the seller! Companies are implementing this tactic to encourage customers to pay early, which helps with their cash flow.
As a buyer, you can save money by taking advantage of these discounts and your accounts payable system can help you manage it. Keep an eye out for these discounts the next time you're paying invoices. It could save you some serious cash!
Not only does this benefit your bottom line, but it also strengthens your relationship with suppliers. Giving them their payment earlier than expected will show them that you’re trustworthy and reliable. So, next time you see that early payment option, don't ignore it!
Overall, streamlining the accounts payable process with real-time approvals gives you more control over your finances. Automating payments reduces errors and fraud, saves time on manual tasks, and provides better visibility into cash flow and expenses. Plus, taking advantage of early payment discounts can help you save money while also building strong relationships with vendors. With these tips in mind, implementing an efficient Accounts Payable system is sure to pay dividends in the long run!
We know that setting up an Accounts Payable system can be intimidating, but it doesn't have to be. Oracle Profitability is Bill.com certified and we can help you painlessly set up an accounts payable system that works seamlessly.
Schedule your free consultation today!