Hotels Slash Invoice Cycle Times by 70% With Automation

Even as the hospitality industry innovates to enhance guest experiences, a quiet revolution is underway in its back offices, fundamentally reshaping how hotels manage their finances and interact with their suppliers.

The Invoice-to-Pay Automation Tracker Series, produced by PYMNTS Intelligence and sponsored by Edenred Pay, delves into the significant challenges posed by manual accounts payable (AP) processes within the high-volume hospitality sector. The report highlights how traditional methods lead to overburdened staff, supply chain instability, costly errors and even increased fraud risk, ultimately eroding guest satisfaction. It presents automated invoice-to-pay platforms as a comprehensive solution, capable of transforming hospitality finance departments into strategic growth drivers by streamlining the entire AP cycle, from invoice intake to payment reconciliation.

Key data points from the report underscore the potential for this shift:

Experts estimate that automated invoice processing can shorten invoice cycle times for a small hotel by 70%. This reduction in processing time helps mitigate late payments and allows AP teams to focus on generating value for the business.

An Institute of Financial Operations & Leadership (IFOL) survey indicated that two-thirds (66%) of finance professionals expect their AP departments to be fully automated by 2025. This marks a significant increase from just 9% three years prior, reflecting a strong industry-wide movement toward automation.

As of mid-2023, only 5% of mid-sized firms had fully automated their AP processes. This figure emphasizes the vast majority of businesses are still grappling with the weaknesses inherent in manual payment systems.

Beyond the immediate financial efficiencies and cost savings, the report suggests a more profound, yet often underplayed, transformation: the elevation of AP staff roles and a renewed focus on strategic initiatives and guest satisfaction. Manual AP processes often trap staff in repetitive, time-consuming tasks and rework, preventing them from engaging in financial strategy or planning improvements for guests.

With automation, hours-long payment processes are completed in seconds, freeing teams to concentrate on higher-value activities such as supplier relationship management, contract negotiation and, crucially, delivering exceptional guest experiences. This shift positions AP departments not merely as cost centers, but as strategic engines driving innovation and sustainable growth for the entire enterprise.

The case of Hotel Emma, which not only streamlined operations but also earned over $30,000 annually in cash-back rebates, exemplifies how automation can turn payments into a new income stream, enabling reinvestment in other critical operations. The report also highlights how these integrated platforms enhance security by protecting payments and mitigating fraud risks, improve cash flow management through real-time visibility, and foster stronger, more collaborative relationships with vendors through options like self-service portals. This move towards automation signifies a pivotal year for hospitality, empowering hoteliers to gain a competitive edge and secure future growth.