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AP Automation Cuts Invoice Coding and Key Entry Time in Half for Franchisee
Challenge:
A rapidly growing franchisee of a prominent quick-serve restaurant brand needed relief from a highly manual invoice and payment processing workflow. Coding and keying invoice data into their AP system took an entire week. Invoices from vendors serving multiple locations were particularly time-consuming, requiring manual routing to multiple approvers. Email reminders and delays were common, risking late payments.
The client made the majority of its payments by check, and the risk of mail delays and late payments was increasing, potentially impacting vendor relations. To ensure vendors received their payments on time and to maintain good partnerships, check payments had to be issued up to two weeks prior to the due date.
The client’s accounts payable team recognized that this system was inefficient and prone to errors and wouldn’t support the continued growth of the franchise. They were aware that automated solutions were available in the market, but they hadn’t yet made a decision to change.
Solution:
The client sought advice from Pinnacle and learned that the firm could assist. With Pinnacle’s AP Automation solution, invoice receipt is centralized, using a dedicated email address. Manual data entry is virtually eliminated because invoice data is captured automatically using optical character recognition (OCR) software. The client’s team now reviews invoices through an online application or mobile device, where approvals are quick and easy. In the same application, The client schedules automatic, direct payment by ACH, card or check payments. Vendors paid by ACH receive an email containing remittance data.
Result:
- The client’s AP staff cut its invoice coding and key entry processing time in half, from an entire week to just a couple of days.
- Invoice approvers appreciate the ease of a central platform that facilitates timely payments.
- System approval documentation is much improved over manual notes and stamps.
- The client’s AP staff doesn’t spend a whole day processing check payments.
- The solution has facilitated moving more payments to ACH, eliminating the need to pay vendors early to avoid late deliveries by the U.S. Postal Service. Gaining adoption by vendors, an increasing number of vendor payments are now made by ACH transfer instead of checks.
- Vendors enjoy being paid quickly, and they no longer have to phone the client for remittance detail on ACH payments because they receive it by email automatically.
- Payments can be scheduled ahead of time for payment on the actual due date.
- Invoices are now stored electronically, with no more paper files.
- Audits are easier because AP Automation is connected to the client's cloud-based accounting software.
- As the client adds more locations, this AP Automation solution allows for growth without adding personnel and frees up time for staff to perform more value-added tasks.