Businesses of all sizes experience inefficiencies when dealing with a high volume of payables, or “mass payouts.” Regardless of the actual volume of payables a company processes each month, organizations that lack the solutions and infrastructure to manage this aspect of their operations efficiently will soon run into obstacles limiting their growth.
Recent PYMNTS research reveals that with the right technology, businesses can optimize workflows and improve integration between payments processes and enterprise resource planning (ERP) systems. Technological improvements are helping companies cut back on labor-intensive tasks such as manual data entry. This is helping them conserve resources at a time when the pace of digitization throughout the economy is accelerating alongside the number of payments businesses make to their vendors and contractors each month.
These are just some of the key findings in High-Volume Accounts Payable: Achieving Long-Term Growth Through Automation, a PYMNTS and Routable collaboration, which examines how businesses use technology to manage large volumes of monthly payments. We surveyed 204 executives from companies with annual sales ranging from less than $1 million to more than $250 million in four industries: transportation, logistics and shipping; online marketplaces; the gig economy; and virtual events management. The survey was conducted from Feb. 15 to March 2 and sought information on why these executives believe automated payables platforms are so important to their ability to grow and manage that growth.
Some additional key findings include:
• Ninety-eight percent of businesses that send out large numbers of payments each month believe they will fall short of their goals for growth if they are unable to handle increases in their monthly accounts payable (AP) volumes. The mass-payout companies that make large numbers of small-dollar-value payments each month have seen their average number of monthly payables surge during the last year.
• Ninety-five percent of surveyed firms saw their average monthly payables increase, and 93% expect monthly payables to increase over the next three years. The companies that have the most pronounced concerns about their ability to process payables sufficiently are also more likely to be upgrading or planning to upgrade their payments platforms.
• Forty percent of businesses surveyed say innovations to their AP systems are more important than some other innovation efforts. Larger companies seem more determined to innovate their AP platforms. Fifty-five percent of the surveyed companies with more than $250 million in annual revenue say AP innovation is more important than some of their other initiatives.
Rising AP volumes present significant problems to many companies across multiple industries, some of which process more than 2,500 invoices each month. A significant share of executives PYMNTS surveyed fear that growth may exceed their ability to handle payments and will prove to be a significant obstacle to long-term growth. A growing number of companies recognize that automating their AP platforms can help them meet the challenges this growth presents. Our survey found that 66% of companies say it is “very” or “extremely” important for their automated AP platforms to handle increased payables volumes and that they are “very” or “extremely” satisfied with automated systems’ ability to handle increased volumes.
To learn more about the steps businesses take to manage large volumes of monthly payments with technology, download the report.
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