It’s impossible to ignore the disruption that businesses of every size have experienced through the course of 2020 as the result of the pandemic. However, this reality has made achieving greater cost-efficiency an extreme priority for next year. Embracing AP Automation is one solution to that challenge and now is the time to budget for AP Automation in 2021.
Although AP Automation has been available for some time, the switch away from traditional manual invoice processes remains uncompleted by many businesses. But with time-efficiency long recognised as a downside to slower, paper-based procedures, moving to technology-powered automated systems is now an obvious way to achieve faster processing and, therefore, greater cost efficiency.
In fact, at a time when reducing costs to lighten the impact that COVID-19 has had, now more than ever is the perfect time to budget for AP Automation.
There are a host of responsibilities and obligations that every company’s Financial Department is tasked with overseeing and managing. These include payroll, management reporting, audit, risk and compliance matters, accounts receivable and of course, accounts payable and general ledger accounts.
In terms of time and resources, these can be quite demanding, and while the precise share can vary from one company to another, typically 45% of a Finance Department’s work is taken up by meeting the demands of Accounts Payable and managing the General Ledger Accounts.
These tasks take up a significant share of the time and resources available, but AP automation technology targets these specific areas to help achieve a time saving and cost-efficiency.
And because manually typing the necessary data into an ERP system drains time so greatly, an AP Automated system can save significantly on time and, ultimately, on costs.
According to research firm Gartner, the average cost of processing an individual invoice in the UK is between £4 and £25, though some costing it as high as £50 per invoice. Generally, it’s reckoned that one Finance Department employee can handle about 50 invoices per day, or 1,000 invoices per month.
This cost, of course, incorporates the variety of tasks associated with Accounts Payable. Some 70% of time can be taken up by the manual data entry of invoices, 15% on resolving disputes, and 5% on getting approvals, handling duplicates and locating missing invoices.
The Kefron AP Automated solution comes at a cost that is significantly lower than the average, typically saving as much as 66% on costs compared to traditional manual costs. This is achieved by cutting time spent on data entry by as much as 80%, locating missing invoices by 50% and chasing approvals by 40%.
These savings in time translates into significant savings in money, boosting efficiency and the bottom line.
There are several benefits that come with changing from a manual invoice processing system to an AP Automation Solution. But the specific operational issues that Finance Departments face are pressing, including:
With time spent on key AP processes reduced by as much as 66%, personnel working in a Finance Department are able to take on other tasks and responsibilities sooner, allowing for higher-value work to be attended to.
Greater processing efficiency means that fewer staff members are required to process the same number of invoices. This in turn lessens the need for team expansion, lifting the pressure to recruit more personnel to meet demand.
For more insight on the benefits that the Kefron AP Automation Solution can deliver and for a precise cost to plan and budget for AP Automation in 2021, contact us and we will be happy to help you understand how valuable the change can be for your business.