‘We’re too small to need accounts payable software!’ is something we hear all the time. Now, we accept that may be true, as there will be some businesses who are genuinely too small for the cost of Accounts Payable (AP) software to be worth it (looking at you, one-man-bands).
However, all too often we see small businesses ignore the need for AP software, and then inevitably grow (whether that be quickly or slowly) and ending up in over their heads. Either they grow too fast and are suddenly totally overwhelmed, or they grow slowly without noticing a huge change, and realise too late that they’re overworking their staff and missing payments.
There are a number of factors to consider, especially as you could be a part of the small demographic of businesses who would see no benefit from automating. Have a look and see if this applies to you.
Time and Resource Saving
This is the main reason people bring in AP software. There comes a point where the volume of invoices grows so much that it only makes financial sense to bring in a robust system. If you’re a sole trader who deals with very few invoices, then you’re probably safe to handle them yourself, depending on how long it takes you each month. Even so, receipt capture software can be a game changer for solopreneurs whose backgrounds aren’t in finance and don’t have the time, or desire to effectively manage their finances.
Is your business one that relies on strong supplier relationships? If yes, then we strongly recommend bringing on software sooner rather than later. Overdue payments and disputes can happen to anyone, but if your business is reliant on a certain supplier you need to be extra careful not to tarnish your relationship. Using accounts payable software greatly minimises these mistakes and keeps an exact record of all purchase orders and invoices, and where your supplies are in their journey, so you never have to wonder.
Are your team members dotted around the country or the globe? Do you or your colleagues travel a lot for work? What happens when those responsible for finance go on holiday?
Cloud-based AP software keeps you all connected and means you can access your data securely, no matter the device. You don’t want to get behind while you’re away or on the move. Good AP software allows you to have a designated person in charge for when your approvers are away.
The Future, Reporting, and Cost
The bottom line is that not every business can afford an AP solution, which is fine if none of the above applies to you. If you have a sneaking suspicion that you might need an invoice processing tool, but it would be so easy to live in the comfort of denial a little longer, this is your wakeup call!
The reality is that once there’s more than one person in your business, you will need a new level of control and visibility so you know exactly where your money’s going. If you’re the boss, you want to give your employees the freedom to do their jobs effectively, without worrying that they’re not adhering to the budget. With AP software, you get the best of both worlds. You gain peace of mind with full oversight of your finance operations, and your employees can make purchases with confidence.
Additionally, while you do have to pay for accounts payable software, you will also see massive savings in the long run. You will initially have to pay for the software, but you’ll make savings by bringing in approvals or OCR (Optical Character Recognition), meaning that you can rest assured you won’t ever pay duplicate invoices. The costs you’ll cut can be more than you think!
Ultimately, only you can weigh up all the factors and come to a decision for your business. If you need advice or a listening ear, book a call with one of our AP specialists who will tell you honestly whether you’re ready to take the plunge.