Automation Solves Primary Pain Point for 70% of SaaS Firms

Providers of business-to-business (B2B) software-as-a-service (SaaS) solutions rely on their finance teams to track financial performance and provide key performance indicators (KPIs) to help fuel decision-making and company growth. However, one major thorn in their side remains: a lack of full visibility and proactive control of non-payroll spending, including supplier invoices and employees’ expenses. In fact, more than 90% of firms surveyed do not have full visibility or control of non-payroll spending until it occurs.

Designed to deploy, track and control the money companies expend to drive growth, non-payroll spend management often relies on inefficient processes. Facing considerable costs and frictions, SaaS businesses expressed interest in one system that would allow them to manage different types of non-payroll spend while enabling accounts payable (AP) teams to work more efficiently and provide faster, more accurate reports to management. Among firms that do not have such a system, 84% would be at least somewhat interested in using one, and 90% are at least somewhat willing to pay for it.

“The Financial Performance Quandary: Leveraging Automation To Better Manage Non-Payroll Spending,” a PYMNTS and Airbase collaboration, examines how much time and effort AP teams devote to managing non-payroll spending, the impact of inefficient processes on business health, and how an automated system can streamline non-payroll spend management and improve financial performance.

More key findings from the study include:

• Lack of visibility and control of non-payroll spending costs SaaS firms roughly 4% of their total expenses. AP teams must manage wasted spend, including zombie, unauthorized, unwanted, duplicative or unnecessary spending, when processing all non-payroll spending — the expenses employees incur and payments based on supplier invoices. Having full visibility and control over non-payroll spending would help firms save approximately 11% of their total wasted spend, which totals between 4.1% to 4.4% of all expenses.

• Nearly half of firms face data entry errors when managing non-payroll spending, and an average of 10% of payments require adjustments due to errors when processing. These frictions most affected small firms in the last 12 months. Data shows that 47% of firms face data entry errors when managing non-payroll spending. This is the biggest challenge for 20% of executives surveyed. Due to errors when processing, an average of 10% of payments to suppliers require adjusting for SaaS firms. For 37% of firms, these payments represent more than 10% of total payments to suppliers in the last 12 months.

To learn more about how an automated system can help SaaS firms better manage non-payroll spending and give finance teams improved visibility and control of those payments, download the report.