Most businesses strive to expand, but expansion can come with growing pains. It can be particularly challenging for growing businesses to manage payment flows. Having inefficient payment operations can lead to excessive payment costs, ultimately eating into firms’ bottom lines and reducing their expansion-related gains.
It is not just growing businesses that are feeling financial pressure to streamline their payment operations. The average business already spends almost 3 percent of its annual budget on payment-related expenses — and many spend even more. This would be enough cause for concern even during stable economic times, but maintaining efficient payment operations is all the more critical in the current economic environment. How can businesses enhance the efficiency of their payment operations to meet their unique, strategic goals?
Payments 2021: Assessing The Digital Gaps In Business Payment Flows, a PYMNTS and Flywire collaboration, provides an overview of business leaders’ chief concerns regarding their business-to-business (B2B) payment operations. We surveyed 459 decision-makers at technology firms, education institutions and travel companies across the United States to learn more about the payments frictions they face, the criteria they use to judge the effectiveness of their accounts payable (AP) and accounts receivable (AR) operations and how they plan to use digital innovations to streamline their payment flows.
Our research shows that businesses can use more efficient data management systems to alleviate many of the common payment pain points they face. Such frictions include difficulties when handling customers’ payment-related questions (cited by 28 percent) and challenges with managing multiple supplier relationships (24 percent). Firms also face stress when handling payments that take too long to receive, with 24 percent of businesses citing long payment wait times as payment-related friction. Real-time access to payment data may not make payments move faster, but it can give cash flow managers and other financial professionals more accurate insights into when they can expect their funds.
It follows that many businesses are planning to enhance their payment processes with digital innovations in the near future. Almost half of all businesses are planning to adopt technologies that will grant them real-time access to payments data in the next three years, but just as many are planning to implement billing and subscription management tools that can automate their payment operations and thus reduce their costs.
These are just a few of the ways in which businesses are looking to digital innovations to enhance their payment operations over the next three years. Payments 2021: Assessing The Digital Gaps In Business Payment Flows provides a nuanced account of the strategic visions of technology firms, education institutions and travel companies across the U.S. and how they aim to transform their strategic payment visions into concrete realities.
To learn more about the digital payments innovations that businesses are planning to implement to ease their payments woes, download the report.