Small businesses need to streamline accounts payable processes
The majority of organisations still use manual data entry processes to manage their finance functions, according to new research.
Just 5% of small businesses told V1 that their accounts payable processes were fully automated, meaning 95% of firms are yet to feel the benefits of such an approach.
Some 48% said it is still paper based in their business while 47% have semi-automated processes in place.
Despite the high proportion of firms that are not yet automated, 58% of firms are planning to boost their automation processes and a further 39% are considering it.
Labour costs can account for 62% of accounts payable costs, according to APQC, driven by the need for manual data entry and document management.
Savings of between 60% and 80% are possible when automating these processes, as time and cost savings can mean staff can focus on other parts of a business, adding value elsewhere.
Improvements in technology are also aiding businesses, as they have the necessary tools to simplify their working processes.
However, only 22% of small businesses have introduced mobile technology into their accounts payable processes, although 77% are either planning to implement it or are considering it.
Around a quarter of businesses believe that mobile functionality would improve the speed at which they can approve invoices, making it a more cost effective process.
Slightly fewer businesses said it would mean better compliance, greater flexibility and enhanced productivity.
Making the processes more efficient is key for businesses as it reduces the likelihood of making mistakes when it comes to managing finances.
Those who fear they may not be managing themselves effectively should consider an independent business review to identify areas where improvements could be made.
It takes an unbiased look at a company’s finances, assets and forecasts, so that a more financially stable future can be sought.
Considering payment processes in this digital age is a key part of business management, especially when the tools are available to enhance the ways that practices are carried out.
By Phil Smith