AP invoice automation

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Show your suppliers some love and they’ll pay it back

Traditionally the accounts payable team spends significant time manually responding to inquiries from suppliers regarding the status of an invoice in the absence of efficient visibility tools for supplier communication. In this blog post, we discuss how AP teams can improve the often strained and broken relationship with suppliers to achieve a mutually beneficial situation for accounts payable, as well as the rest of the organization, and its supplier base.

The most common questions the AP team get from suppliers

  • Have you received my invoice?
  • Has my invoice been approved yet?
  • Has my invoice been paid? If not, why is this and when will it be paid?

Imagine the total amount of questions the AP team will receive if the organization has hundreds of suppliers, each sending numerous invoices per week… It is clear that this task will take a lot of time and resources from the already busy AP team.

Supplier portals are dead, long live supplier notifications

As a response to this issue, many organizations have tried to implement supplier portals as part of a P2P initiative driven by the procurement department and delivered by procurement system vendors. But these initiatives most often fail to align AP processes with supplier communication due to the cumbersome nature of these portals and the unwillingness of suppliers to log-on to the various different portals of their customers to find the information they need.

3 ways supplier portals fail to support accounts payable

  • Only a small portion of suppliers are onboarded, leaving a large number of invoice status inquiries outside the system
  • Supplier portals are not built for AP needs, hence the functionality they could use to communicate with suppliers is hard to find and use
  • Neither AP teams nor suppliers want another system to log into in their day-to-day work, resulting in low user adoption

The modern alternative: supplier notifications

Most AP teams already have a solution in place to support digital and automated invoice processing, some of which can also offer a supplier notification tool. This way, the AP team can easily set up automatic email notifications to be sent to the suppliers updating them on the status of all their outstanding invoices at a cadence of their choice.

For most organizations, a supplier notification tool in the AP automation solution eliminates the need of a supplier portal. And since it’s available within the system they already use for AP invoice processing, they can get up and running quickly delivering value to the AP team, as well as their suppliers, in no time.

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Further reading: The modern AP manager's automation toolbox

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Happy times for suppliers and buyers

Streamlining and automating the communication to suppliers will be a great time saver for the accounts payable team, but will also help improve the relationship with suppliers who play a crucial role in a business’ value chain. In addition, suppliers who trust they’ll get paid in time, every time, will be more open to discuss terms and discounts during the next round of negotiations, opening up for hard cost savings and positive bottom line and cash flow effects.

3 benefits of automated invoice status updates to suppliers

  • Time savings for the accounts payable team, as there will be less or no more invoice status inquires by phone or email
  • Improved relationship with suppliers, securing the overall supply chain
  • Faster processing of invoices when AP staff can focus on their core tasks rather than answering supplier inquiries, eliminating late payment fees and generating potential early payment discounts

If you wish to learn more about supplier notifications and how it could help your AP team save valuable time, contact your local Medius representative.

Daniel Saraste

Daniel Saraste

Director of Products

daniel.saraste@medius-group.com
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