By: Jim Campbell
VP of Construction at AvidXchange, Inc.
Cracks in a foundation can compromise everything else you build on top of it. We keep this top-of-mind in construction when it comes to standing up new physical structures, but we often forget to apply the same philosophy to our back offices. We place so much focus on core products and services that we can fail to establish sustainable internal systems to keep our businesses functioning as, well, actual businesses.
So, if you’re looking to scale your company for growth, start by identifying those processes that seem fine today but could easily crumble under the added pressure of higher volume tomorrow. Seek out solutions for any inefficiencies you find to ensure your infrastructure is ready to support a new business boom. Secure your foundation before you build on top of it.
Automating payment processes can fortify your financial foundation
Accounts payable (AP) – the money you owe vendors or subcontractors – is one of those foundational functions. It’s a primary pillar of the company’s overall financial standing and executives are basing almost every other business decision on their view of that financial picture.
Yet in today’s digital world, most mid-size businesses are still relying on manual, paper-based payment processes that take too long, cost too much and provide too little cash flow visibility.
In the construction industry, where the “days payable outstanding” already hovers between 52-54 days and timelines, cost and labor drive decision-making, paying your bills better can truly make a difference.
Fortunately, automating AP with a cloud-based technology solution like AvidXchange with Deltek + ComputerEase comes with several key benefits to help you do just that.
Here are three ways automating payment processes in the present can help you scale for the future.
1. Payment automation maximizes efficiency
Time is a limited resource, and spending time reviewing invoices, printing, signing and mailing checks leaves less time to focus on business strategy.
Automating your AP creates efficiencies by streamlining the invoice approval process and providing transparency in the payment flow to reduce risk, obtain better payment terms with vendors and deliver projects on time.
Payment automation also allows your AP department to spend more time on value-added functions like scheduling payments to meet your cash flow needs, capturing early payment discounts and ensuring vendor compliance is enforced.
Maggie Josephson, the office manager at South Carolina-based Ridgeline Construction, knows firsthand the feeling of liberation an AP automation solution like AvidXchange provides.
Ridgeline works with roughly 100 vendors at any given time, but they have more than 800 in their portfolio, saddling Josephson with a never-ending cycle of tracking vendor information, collecting paper invoices, chasing down approvals and issuing checks.
But that cycle came to an end when Ridgeline automated their accounts payable processes.
“I am saving roughly one week each month by using AvidXchange and I’m able to focus on other aspects of my job,” says Josephson.
“Now, I push the same button that I used to push to just start the check printing process and the payment is processed and off to the vendor.”
2. Automating increases your visibility and control over payments
This added efficiency doesn’t mean giving up control of what happens with company dollars. In fact, it’s the opposite.
With automation, you have increased visibility and greater control by having immediate access to review, code and approve account information, even from a mobile device.
“Our COO works remotely two days a week, and he can now review invoices from his house anytime,” says Matt Weinert, an accounting manager at Washington, D.C.-based Abdo Development.
“He utilizes the AvidPay queue to manage payments, pushes ‘approve’ whenever he wants, and AvidXchange takes care of the rest. It’s just been really helpful for everyone.”
When invoices and payments are sent, received and managed electronically, the risks of missing invoices, fraud and late payments are drastically reduced.
With more visibility into cash flow, you can make better, data-driven decisions.
3. AP automation can enhance vendor and subcontractor relationships
Improvements to your internal process mean you can pay vendors and subcontractors, securely and via the method they prefer, on time, every time.
And let’s be honest, getting paid on time is key to cultivating strong relationships in the business world, which is more important than ever as the construction industry continues to grapple with a shortage of skilled labor.
Whereas paper-based payment processes can take weeks, if not more, to process, print, sign, and mail checks, automation allows you to process invoices and push payments faster and more accurately.
AvidXchange and Deltek + ComputerEase make it easy to automate accounts payable
Perhaps the best part about automating your accounts payable processes is you don’t need to overhaul your enterprise resource planning systems, thanks to AvidXchange’s integration with Deltek + ComputerEase.
AvidXchange is the industry leader in AP automation for the middle market, with a full suite of accounts payable software solutions for the construction industry.
We partnered with Deltek + ComputerEase to establish an integration with their platform that allows contractors to add accounts payable and payment automation to the long list of incredible features their software already provides.
With AvidXchange, you can pay your vendors electronically while maintaining your banking relationships and current payment approval workflows. Payment information is sent from Deltek + ComputerEase into AvidPay for execution and then input back into Deltek + ComputerEase, maintaining it as your single source of truth.
To learn more about automating your payments with AvidXchange and Deltek + ComputerEase, check out our on-demand webinar: Scaling for business growth in 2020 with accounts payable payment technology.
Jim Campbell specializes in helping companies streamline accounts payable operations and creating efficiencies through automation and best practices. Jim comes to AvidXchange with an impressive career in construction software sales and as President and COO of CIS Consulting Group where they excelled at meeting the automation needs of over 1700 construction companies, and he developed necessary skills like leadership, financial management, and talent development.