Five Practical Ways to Leverage B2B
Payment Processes at Your Business
In today’s business world, paying bills can be a bit of a headache. Whereas most businesses sell directly to a consumer, sometimes companies need to buy supplies/services from other companies. This form of commerce is known as business-to-business (B2B). Automating the B2B process with a comprehensive software solution is essential to smooth operations. It’s also necessary to figure out an effective means of handling invoices, accounting, and supplier payments. Here are a few key benefits of implementing B2B payment automation processes into your accounting procedures now:
Streamline Your Company's Expenses
The simplest concept in any business is that vendors and suppliers need to get paid accurately and promptly. Many businesses (including suppliers) can receive payments in a number of ways: credit/debit cards, paper checks, ACH transactions, contactless payments, and even online payment services. But one of the better payment methods available today is using virtual cards. Virtual cards are a secure method for making B2B payments, largely due to their ability to prevent fraud and give the supplier the ability not to reveal their financial details. As a randomly generated, 16-digit card, virtual cards are single-use and expire the minute they’re used. This effectively prevents them from being easily compromised or stolen. Many of the major credit card companies offer virtual cards and integrating them into your B2B payment systems is one of the better ways to streamline company expenses.
Understand Your Spend And Transaction Visibility
Monitoring spend risk across all risk vectors is critical. With a B2B payments solution, you can get better control over your payments. One way is to use the virtual cards we mentioned earlier. Another way to help eliminate fraud/risk is through community-driven bank account validation automatically performed by the software. The software also checks to ensure compliance with anti-money laundering (AML) and Office of Foreign Assets Control (OFAC) compliance. Maintaining this compliance is necessary and when combined with the software's automatic account reconciliation can reduce the burden of detecting fraud and managing risk at any organization.
Create Savings Opportunities
Companies typically seek ways to cut costs that won’t impact workers, customers, or the operation. Working capital—the difference between your company's assets/cash flow and its current liabilities—is crucial to your operations. Visibility and measurement of the company’s liquidity/spend are easier when all the accumulated data is assembled in one place. Gleaning unique insights from the data to help unlock your working capital is the key to maximizing your saving. Early payment discounts are a boon to any B2B operation. The concept is simple: you work with a supplier to arrange a discount for paying an invoice early. EPD's don't just score your business a discount; they help build rapport and foster better relationships with suppliers that can last for a long time. As with anything in business, a payment discount isn't a one-stop solution to reducing costs. Instead, it's a helpful supplement for increasing savings. Using a quality B2B Payments system can award the most reputable suppliers while assisting you with finding additional savings opportunities across your entire operation. B2B software can also help maximize credits and rebates so you end up saving more while paying bills/invoices on time.
Create A More Productive Workflow
Another advantage of adopting a B2B payments system is how well it will improve your company’s workflow and productivity. A large part of the process involves automation. Remember with a B2B operation, you're not exclusively paying suppliers. You're paying beneficiaries, employees, subsidiaries, and other organizations too. Onboarding suppliers and processing payments can be automated as well. Manually performing these duties is labor-intensive, to say the least. Paperwork can stack up, errors might occur, and unknown variables may enter the mix to wreak some sort of havoc. By adopting an inelegant automation solution for your payments, you're going to improve productivity and get all of your payments done right. Plus, fewer errors mean a smoother operation, which ultimately leads to continued success for any company.
Better Spend Under Management And Virtual Cards
In a B2B organization, you may deal with fewer customers than a B2C operation, but the financial bonds you build with them are critical. Forging stronger relationships can help with your spend under management, too. Spend under management is just the amount of spending controlled by the procurement department each year. Despite that simple definition, it’s an incredibly nuanced, detailed process. It’s usually something procurement managers worry about throughout their daily operations but worth keeping an eye on at any stage of the supply chain. As part of a good B2B payments solution, spend under management is much easier to manage thanks to streamlined operations. By taking advantage of the software’s benefits, you can simplify some of the more difficult B2B management processes while ultimately improving customer/vendor relationships.