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Top accounts payable outsourcing companies provide their clients with highly-skilled professionals and technology. If you run an accounting firm, you know the importance of having a streamlined accounting process. As a result, manual data entry has become the norm — and it’s time-consuming. As with many things, the advantages of outsourcing accounts payable come with a few downsides as well.
- That includes sending reminders when payments are due, following up with vendors if necessary and making sure everything runs smoothly at all times.
- Some companies find that the cost of outsourcing is offset by the overhead savings created by delegating certain processes to an external provider.
- Take a few pages out of WeWork’s playbook and learn how automation can solve some of the greatest challenges facing your finance team.
- The platform can be used to process invoices, automatically capture data, do approval routing, and process payments.
- The company also offers out-of-the-box integration with most ERP systems for seamless data transfer as well as process analysis and optimization services.
As vendor relationships grow ever more complicated, more and more businesses will need to rely on outsourced providers to re-architect their accounts payable operations. Outsourcing is not merely the shifting manual tasks like data entry to an outsourced provider. According to most case studies, companies typically use process outsourcing to add value to their businesses and to improve AP dramatically. If you are trying to decide whether to outsource or automate your accounts payable processes, you have to ask yourself what your business wants to accomplish. If the primary goal is to take the workload completely off of your hands and lose oversight of your payables, then outsourcing may be the way to go. If you would rather streamline your in-house AP department and retain control while maximizing efficiencies, you will want to automate AP.
GEP’s mailroom and invoice scanning services help you centralize receipt of all invoices — paper, fax, or digital. All your invoices are converted into a digital format, using best-in-class imaging technology with unique reference codes. Free up your resources from time- and effort-intensive paper work and data entry to help them focus on more strategic initiatives. Any company dealing with accounts payable best practices in-house is bound to have greater control over its processes.
Here, an AP outsourcing provider serves as a bridge, offering sophisticated security measures and cutting-edge technology for accounts payable processes. By doing so, the outsourcing partner effectively reduces the likelihood of a company falling victim to payment fraud or other security breaches. These cost savings contribute to improved cash flow and the overall financial health of the business. To acquire the resources necessary to streamline their internal processes, small and medium-sized businesses often turn to accounts payable outsourcing companies to fill the gap. Volopay is an accounting platform that businesses can use to manage their accounts payable process from end to end.
Advantages of Outsourcing Accounts Payable
That said, AP automation can be made even more efficient with payment services from MineralTree. These services extend the capabilities of your own AP team to address pain points such as vendor enrollment and inquiries. AP automation typically begins with digitally capturing invoice data through a scanning or capture method, such as optical character recognition (OCR). With a platform like MineralTree, invoice capture is combined with human review for 99.5% accuracy.
- Here are some of the biggest companies currently redefining accounts payable outsourcing services.
- The efficacy of third-party service providers is difficult to gauge without implementing performance metrics and measurement tools.
- They claim to reduce 83% of manual data entry, cut invoice processing costs by 86%, and strengthen your entire accounts payable processes using AI.
- Short term volume peaks can be handled by use of available qualified team members who are on the bench.
You may never know if they are billing for idle time, accessing non-work websites, accurately reporting issues, etc., if you don’t set expectations and check that they’re met. While it is easy to supervise an in-house AP team, the same cannot be said for third-party service providers. You cannot control how they handle your accounts or run back-office processes.
As a result, AP teams must proactively protect their businesses and minimize ACH payment fraud. There are several tools that teams can use to move away from these manual and expensive processes. For example, many businesses incorporate AP automation, e-invoicing, and other digital tools to quickly gain an edge over their competitors. Offloading and outsourcing AP tasks to avoid retraining teams or hiring more staff is another method used by finance teams to modernize their back office. As a business owner or a financial manager, it’s crucial to find the best way to manage your accounts payable processes.
Top-notch providers will not just take over these tasks, they will optimize them by introducing new capabilities and developing more efficient business processes to enable growth. Accounts payable outsourcing is the practice of hiring a third party to handle your organization’s AP processes. AP providers come fully equipped with the tools, skills, and technology not only to manage your existing accounts payable functions but also to integrate new capabilities to give you a more streamlined environment. Lack of control over in-house accounts payable processes can lead to repeated mistakes such as duplicate payments, missed payments, scrupulous reporting, and more. By outsourcing to third-party account payable services, the best financial document management companies handle your AP functions. It also frees up your in-house AP departments to focus on higher-level tasks and core business processes.
IQ BackOffice – Comprehensive yet Flexible Accounts Payable Outsourcing Solutions
Outsourcing your accounts payable functions can give you the flexibility to quickly scale up or down, depending on changes in business needs. Upgrading old accounting systems to modern tools is costly and time-consuming. But evaluating your options with a complete understanding of what’s available leads to better business outcomes. Plus, an accounts payable service or organization can serve each customer in a fraction of the time because they’re specialists.
That data is then stored on their internal servers or in a data center via the cloud. Depending on your industry, you may need to meet rigorous privacy standards to avoid fines and other penalties. Even a small error, such as an inaccurate payment to a vendor, can cause serious problems during an audit.
Outsourcing AP forces many teams to forfeit the ability to optimize and strategize how and when they pay vendors in order to maximize cash flow. Meanwhile, using AP automation with or without a payment service provider keeps teams in the driver’s seat. Accounts payable automation also significantly reduces fraud-risk by providing both management and AP staff with heightened visibility into the flow of invoices and transactions across the organization. Understaffing AP teams increases the likelihood of fraud, especially in regards to ACH payments. When it comes to ACH payments, it’s not only a hassle for your team to collect and update vendor bank account information, but this process also exposes your business to greater fraud risk.
It’s not as if the vendor is a mix of roles from CFO and Controller, to AP Manager and AP Processor, which can happen at smaller firms—one person wearing many hats. Depending on where the vendor is located or if they have top 24 entrepreneur organizations a distributed staff, you may find one with near-constant uptime when they are utilizing technology like AP Automation. Despite the myriad benefits of outsourcing your AP processes, it may not be the best choice for you.
M&A Integration Services
Accounts payable outsourcing companies use professionals familiar with the latest tools or software to optimize AP processes. This means that your business is powered by the latest technology and high-precision tools without you having to invest in them. Accounts payable outsourcing is the process of hiring a specialised service provider who can take over multiple AP functions that businesses find difficult to handle in-house. Some companies find that the cost of outsourcing is offset by the overhead savings created by delegating certain processes to an external provider.
To streamline your AP processes, your data submission systems will need to be updated. Ensure your employees are up to date with these to avoid errors or duplication. When you hire new employees, you don’t just hire anyone — you consider their skillsets to determine if they’d be a good fit for your company. Similarly, you need to make sure that you pick the best outsourcing provider. Depending on the industry standards and your outsourcing provider, the data may be stored on internal servers or even on the cloud. This could increase your data’s accessibility — making it prone to unauthorized access.
Accounts payable (AP) outsourcing companies step in to handle your company’s invoice capture, verification, and payment systems. With reliable accounting staff in critically short supply, a good AP vendor ensures your suppliers and vendors get paid on time, all the while unlocking big potential savings on staffing, equipment, and overheads. Corcentric’s wide range of product solutions such as accounts payable outsourcing, invoice processing, as well as accounts receivable, makes us an essential part of the success of any company. With a relentless focus on the customer, Corcentric works with businesses to improve cash flow and achieve the operational efficiency they’ve been searching for. In essence, it simplifies each invoice, making them easily accessible, traceable, and paid promptly.
Many business leaders expect a huge headache in switching from a traditional AP system to a more practical automated one. Companies that are worried about headcount expansion are often struggling with an equivalent increase in paperwork. An AP outsourced business solution might sound like it operates more efficiently, so it can improve your bottom line. But as a general rule, that’s because they’re using more efficient technologies. That’s why financial outsource industries and businesses have switched to AP automation.
While you have to hire employees and spend time training them, you also need to purchase the tools required to do the job! Many accounting firms outsource their Payable department, and there are benefits to doing so. However, caution must be employed when deciding to outsource this department, as outside firms may not have the level of personalization that is needed for unique auditing practices. Numbers like that mean real savings not only by right-timing major expenses and taking advantage of early-payment bonuses, but also in bread-and-butter savings on back-office staffing, equipment, and overtime expenses. Most importantly, it frees up talented, creative staff to focus on improving your core revenue-driving operations. As your business grows and your need for Account Payable services grows we can add qualified and trained Account Payable resources to your team.
For instance, you can implement Stampli’s best-in-class AP Automation software and train your team within days. It would take you a week just to set up introductory calls with outsourced vendors. Uptime and accountability – Given that this is their sole purpose, your AP needs will receive a lot of attention.