One of the integral parts of building streamlined business operations is figuring out what your payments process looks like. If your company is like most businesses, then chances are that you make a lot of payments to different suppliers and vendors that you use to deliver goods and services to your customers.
Paying those suppliers and vendors on-time, with the right amounts, in the most efficient manner, can be a cumbersome process. If you need some ideas on how to revamp and improve those operations, then you’re in the right place.
We’ll discuss some ways you can streamline payments in this article.
Automate Payments Whenever Possible
The first thing to think about whenever you’re trying to streamline the payment process is that whenever possible, you should lean on automation. This is in fact a general rule to follow when it comes to business operations. If a manual business process can be automated, then it should be.
There are a few different ways that business payments can be automated, but they all require technology. You’ll need to be able to use an ERP or some kind of accounting software to read purchase orders and invoices that are being issued.
Ideally, the recurring payments that you make should be consistently the same total, which makes it easier to automate the payment. But what about when you can’t pay the same amount to a particular supplier every month? This could be due to a dynamic inventory, for instance.
You’ll need technology to interpret those needs and translate that into payments.
Batch-Process Bank Checks
As you try to streamline company payments, you should always be looking to move away from paper and closer to technology. However, there are some old-school suppliers and vendors that require you to pay via check.
In the event that you have to pay by check, then there is still one way you can streamline that payment: batch-process those checks.
When you consider administrative overhead, fraud protection services, and the like, then the cost of sending a single check begins to skyrocket upward. By batching your check processing, you can cut down on that overhead.
Extend Payment Terms
Last but not least, one of the best ways to streamline your payment process is simply to pay less often!
Talk to your suppliers and vendors to see if you can extend payment terms. for instance, instead of making monthly payments, see if you can make quarterly payments.
This will likely take some negotiating, as most suppliers to which you make payments in a construction business will want to have their money as soon as possible.
How to Streamline Payments as a Business
There you have it. Equipped with this guide to improving financial processes, you should now have a much better idea of how to streamline payments. Always remember to lean on technology as much as you can to automate!
For more business advice, be sure to take some time to check out the rest of the articles available on the website before you leave!