As mid-market businesses strive for growth and sustainability, optimizing accounts payable (AP) processes is a critical step in any long-term planning. AP is ripe for modernization, specifically with invoice processing. Manual AP processes are insufficient and create hurdles when attempting to scale. Businesses can start with digital invoice data capture, a proven way to reduce costs and improve operational efficiency.
When working with multiple vendors, some may have electronic invoicing capabilities and others may not, but it’s better to be on the right side of the coin regarding your AP. Digital invoice capture offers multiple ways to receive data as well as seamless standardization to maintain data accuracy and better margin control.
Here are the top 10 reasons why your business should capture invoices digitally:
1) Improved Efficiency and Time Savings
Manual data entry is the bane of any AP workflow. The time it takes and the susceptibility to errors make it a wonder any P&L gets put together when invoice data capture is left to manual devices. Digital invoicing automates the process, speeding up the time to invoice data visibility and allowing businesses to stay current on finances without a backlog. Businesses that automate their invoicing processes can save up to 70% of the time spent on manual invoicing tasks. That equates to 5 minutes saved per invoice digitally ingested.
2) Better Accuracy and Reduced Errors
It is no secret that manual data entry is prone to errors, yet over 60% of AP teams still report that at least one team member is manually keying invoices into an enterprise resource planning or accounting system. Digital invoice capture promotes cross-checking to ensure accuracy with price book information, GL coding, and more. This minimizes costly errors that require additional forensic research to find the source of the discrepancy. Fewer discrepancies mean faster processing cycles and happier supply chain partners.
3) Faster Access to Current and Historical Data
Manual invoice data capture leaves gaps in access, which can be crucial for businesses looking to optimize budgets and ordering. By digitizing invoice capture, businesses can realize cash flow faster, track performance, and have a clear understanding of their AP without having to wait on long processing cycles. Most digital processing systems also provide an online vault of past invoice history, allowing teams to quickly go back and reconcile with past data as needed.
4) Enhanced Compliance and Audit Trail
With digital reporting, it is easier to search and review invoice data to maintain compliance and support financial audits. Certain markets require adherence to local regulations or guidelines, which digital invoice capture can provide. For example, businesses buying and selling alcohol must do so with strict attention to regulatory guidelines to avoid costly issues with licensing. Having standardized data makes it simple to comply with audits and improve reconciliation with accurate, organized invoice records.
5) Simplified Multi-Location Operations
For businesses with multiple operations, digital invoice capture consolidates processing cycles into one easy-to-use system. This creates a throughline of standardized AP workflows that are consistently accurate. When it comes to managing invoices from multiple vendors across locations, digital invoice capture ramps up efficiency without sacrificing the quality of invoice data integrity.
6) Variety of Acceptable Capturing Methods
Capturing invoices digitally can occur in multiple ways. What is important is having options for supply chain partners to send invoices digitally. Some examples would include a vendor integration that converts EDI, CSV, or other file formats, or an online digital invoice builder where vendors can create, upload, and send invoices. From there, a good invoice processing solution can standardize the data to match a business’s GL coding and price book information. Part of the beauty of digital invoice capture is translating it into an acceptable format for ingestion.
Products like Fintech’s PaymentSource® Premium offer a variety of different ways to digitize and standardize invoices, capturing invoice data all in one place.
7) Scalability
As businesses expand their vendor network, it is important to have a system equipped to handle the larger volume of invoices without interruptions. With 35.7% of AP teams processing between 1,001 and 5,000 invoices monthly, having a digital invoice capture solution makes sense to keep up with demand.
Businesses can utilize dedicated vendor integration management teams on top of digital invoice capture to reinforce optimization. Best of all, digital invoicing can easily work with other tools like accounting software and back-office systems.
8) Supply Chain Satisfaction
Digital invoice capture supports faster payment cycles, strengthening vendor relationships and ensuring satisfaction with business performance. A business using electronic invoicing can expand their vendor purchasing network with ease thanks to simplified B2B transactions.
9) Futureproofing
Automation is the future of commerce. While the majority of companies describe themselves as partly automated, there is a growing demand to increase automation capabilities throughout accounts payable. 41.4% of companies reported their plan to automate their AP process within the next year, so jumping ahead of the curve with digital invoice capture prepares the company for the business of tomorrow.
10) Cost Savings
Manual invoice data capture increases costs in many ways. The resources it takes to manually key in data and research mismanaged invoices when errors cause margin erosion is a logistical nightmare for businesses with multiple locations. As businesses grow and start processing more invoices, their AP workflows will incur more costs if not automated to save time and money. Capturing invoices digitally reduces the rising operational costs associated with ingesting more invoices.
Automation Over Stagnation
Manual invoice capture and AP workflows slow business down. Upgrade to digital invoice capture to stay ahead in the fast-paced world of business technology. Fintech offers digital invoicing solutions to help businesses improve vendor integrations and maintain the flow of business without a hitch. Contact us to learn more.
