Accounts Payable outsourcing has become a popular solution for businesses to streamline their financial processes and reduce expenses. The rapid pace of technological innovation and increased access to internet-based applications has led to numerous trends transforming how companies approach AP.
This article will explore the top 10 trends in Accounts Payable outsourcing and what they mean for businesses looking to improve their AP processes.
#1. Digital Transformation of AP Processing
The use of digital technologies such as automation, artificial intelligence, and machine learning is transforming the way businesses approach AP processes. These technologies allow faster and more accurate processing of invoices, reducing the risk of errors and improving the overall speed of the AP process.
Automation, in particular, is a crucial driver of digital transformation in AP, allowing businesses to automate manual and repetitive tasks and freeing up resources to focus on more strategic initiatives. However, companies find that partnering with an outsourcer allows them to accelerate their digitization and automation journey by leveraging their outsourcing partners experience.
#2: AP Outsourcing and Cloud-based Solutions
Cloud-based solutions are increasingly popular in the AP outsourcing market, offering businesses the ability to access AP data and processes from anywhere, as well as improving scalability, security, and cost-effectiveness. By leveraging cloud technology, companies can partner with a third party outsourcer like IQ BackOffice who can help better manage their AP functions by accelerating invoice approval workflows and reducing the risk of data breaches and other security incidents (more on that in #5 below).
#3: Increased Focus on Supplier Management
#4: Accounts Payable Outsourcing and Data Analytics
Data analytics is becoming an increasingly important tool for businesses looking to gain deeper insights into their AP processes and make data-driven decisions. By analyzing AP data, businesses can identify inefficiencies, develop strategies to optimize their AP processes, and gain insights into areas for improvement. This can lead to improved efficiency, reduced expenses, and better decision-making. Experienced AP outsourcers provide reporting on Key Performance Indicators (KPI’s) to highlight these metrics.
#5: Increased Security and Compliance gained with AP Outsourcing
The need for robust security measures is a crucial requirement for AP processing given the prevalence of security threats. In the AP outsourcing market, a requirement for providing AP services includes addressing the implementation of advanced security measures to protect sensitive financial information, risk reduction of data breaches and fraud, and ensuring compliance with industry regulations.
#6: Process Standardization and Automation
Standardization of AP processes and increased automated solutions are becoming increasingly important for businesses looking to minimize errors and reduce manual workloads. This can lead to improved accuracy, reduced expenses, and increased productivity. Partnering with an outsourcer with expertise in reengineering and best practices will enable you to efficiently streamline.
#7: AP Outsourcing Leads to Cost Optimization
A focus on cost optimization is a key trend in the AP outsourcing market as businesses look to reduce expenses and improve their bottom line. This involves implementing cost-saving solutions to optimize AP processes and includes reducing manual processes, improving vendor payment processes, and introducing more efficient technology solutions. An effective and efficient outsourcer should be able to reduce your costs significantly.
#8: Integration with other Systems
Integration with other business systems, such as ERP, procurement, and expense management systems is becoming increasingly important for businesses looking to improve the flow of information and enhance overall efficiency. This trend involves using technology to integrate AP tools with other business systems, improving the flow of information and reducing manual workloads. This can lead to improved efficiency, reduced expenses, and enhanced decision-making. AP outsourcers like IQ BackOffice will support integration of these systems.
#9: Increased Focus on Vendor Payments
Making vendor payments faster, more accurate, and more secure is becoming increasingly important for businesses. This trend involves using the latest in payment technology solutions to streamline vendor payments, reduce the risk of errors, and by accelerating the process helps to improve vendor relationships. This can increase efficiency and lower costs.
#10: Mobile AP Solutions
Mobile AP solutions are becoming increasingly popular as businesses look to access, automate, and digitize bill approval, review documents, collaborate with reviewers, and even authorize payment.AP outsourcers like IQ BackOffice provide software applications that are accessible to any internet enabled mobile device.
Conclusion - Top trends in AP Outsourcing
These trends in AP Outsourcing represent a significant shift in how businesses approach financial processes. From digital transformation to improved supplier management, these trends help businesses reduce expenses, increase efficiency, and streamline their AP processes.
By embracing outsourcing, businesses can better achieve their financial goals.
AP Trends and Best Practices: FAQs
Are You Considering Outsourcing Your Accounts Payable? IQ BackOffice Can Help
At IQ BackOffice, AP Outsourcing means that invoices received are digitized and made available for online access for you, generally within 24 hours. We also process invoices with 99.97% rate of accuracy, eliminating duplicates, reducing errors and unnecessary reconciliations.
Our world-class technology provides our clients with complete transparency and easy to use inquiry tools with drill-down capability so they can readily access the specific information they seek. Clients can easily see the status of any specific vendor invoice with complete audit trail of the processing history and can download the invoice information in whichever format (excel or pdf) they need. We also track processing performance metrics, highlighting root cause of processing inefficiencies. We detail our team’s performance and highlight the bottlenecks to our performance.
For example, Vendor ScoreCards reveal the root causes of challenges such as not putting PO on the invoices and our Inbox Approval reporting reveals where there are aged invoice backlogs.
Here at IQ BackOffice, we provide financial business process outsourcing for large and mid-sized enterprises. We serve a range of diverse industries, including manufacturing and distribution, healthcare and dental, restaurant and hospitality, energy, retail, and technology. Our solutions enable companies around the globe to automate and streamline the complex financial processes they manage.
IQ BackOffice reengineers financial processes to take advantage of best practices and leverage state-of-the-art automation. This allows us to remove manual or inefficient steps, delivering improved controls and up to 70% cost savings for our clients.
To find out more about how IQ BackOffice can reduce costs and streamline your Accounts Payable function, get in touch with us.