But many U.S. companies initially lured to offshore locations like India and the Philippines by bottom-of-the-barrel pricing are also rethinking their strategy. Nearshoring from Latin America has emerged as a leading solution for North American organizations over the last decade. Identifying your biggest business drivers at the start – and aligning your leadership team and BPO provider behind them – ensures the greatest value. According to one study by the American Productivity and Quality Center, the bottom 25% of organizations surveyed were paying $10 or more for each invoice they processed. This is essential to judge how well the outsourcing provider’s privacy and data protection measures match up to yours.
- An Accounts Payable SLA might demand that the BPO provider achieve an accuracy rate of 98% when processing bills.
- With years of experience in the accounts payable industry, APS has developed a thorough understanding of the specific needs of various business sectors.
- An increasing number of businesses are outsourcing their accounts payable processes to a specialized third-party team.
Typically, a consultant meets with senior management to discuss business opportunities and challenges. Additionally, the possibility of human error, common in manual data entry, is eliminated when accounts payable is automated. To guarantee the accuracy, data can be validated and cross-checked against existing databases and ERP systems with automation.
From there, they will provide a proposal that outlines the services they can provide and the related costs. Sometimes this involves the implementation of new systems or business applications that will make your life easier and provide better information. Other times, they will recommend changes in your accounting practices to improve internal controls or enhance efficiencies. Regardless, working with the right firm can make all the difference for your growing company.
Evaluating cost and value
Separate Accounts Payable departments are also unaware of system adjustments, such as vendor transaction updates, which might produce future problems or duplications. We sincerely believe in the importance of working with unwavering commitment and gaining the trust and sanctity of our organization and yours. Given our commitment to upholding the highest levels of professionalism and integrity, we are confident that partnering with us represents the best option for our clients.
Some accounts payable services extend to include assistance with vendor negotiations. This includes negotiating favorable payment terms, discounts, or pricing arrangements to reduce costs and strengthen supplier relationships. Queries or issues regarding AP will also need to be routed to an external party, which may take more time than handling them internally.
If there are limited resources within your AP department, it becomes crucial to plan on how to scale the function to deal with greater volumes of invoices and data entry. Through AvidXchange and QuickBooks integration, users may automatically check purchase orders on QuickBooks with invoices received and processed on AvidXchange. AvidXchange users can also keep track of their accounts payable information and link it with their QuickBooks account. In addition, AvidXchange has more than 200 integrations with widely used enterprise resource planning and accounting systems while matching existing approval workflows. AvidXchange can integrate with current accounting systems and streamline the entire invoice process.
Outsourced bookkeeping services
This includes receiving, validating, and matching invoices to purchase orders, resolving discrepancies, obtaining required approvals, and ensuring timely payment. We strive to be a trusted extension of your team, assisting you in achieving your business objectives and navigating the ever-changing landscape of accounts payable management. Our dedicated account managers collaborate with you to optimize your accounts payable processes by providing ongoing support, guidance, and strategic advice. APS recognizes the significance of robust vendor relationships for the success of your business.
Pros and Cons of Accounts Payable Outsourcing
Duplicate invoices may also result in duplicate payments, higher expenses, and decreased profitability and cash, all of which can severely limit cash flow management. Before making a decision, conduct exhaustive research and assess multiple providers. We employ stringent security measures, such as secure data transfer protocols, encryption, and restricted access to sensitive financial data.
We’re an extended part of your team, keeping a constant eye on your accounting, giving you peace-of-mind to help you achieve your business goals. This can be done for quite a low bottom line hourly rate depending on where you’re comfortable outsourcing to. If you want to keep this part of your business closer to home, check for local AR/AP services in your area.
What are accounts payable services?
Information collection, data centralization, provider selection, and implementation all require time and effort. When considering outsourcing, answer the following questions to get a better idea of your needs and what’s possible. While it is easy to supervise an in-house AP team, the same cannot be said for third-party service providers. You cannot control how they handle your accounts or run back-office processes.
Since everything is organized, you can also make early settlements of vendor bills to get better discounts. There is generally a gamble that the nature of work offered by the support supplier may need to measure up to the organization’s assumptions. This could lead to errors or delays affecting the company’s relationships with vendors and financial operations.
When you hire new employees, you don’t just hire anyone — you consider their skillsets to determine if they’d be a good fit for your company. It’s easy to supervise your in-house invoice processing activities as your employees are always visible and accessible. Some people mistakenly believe that accounts payable refer to the routine expenses of a company’s core operations, however, that is an incorrect interpretation of the term. Expenses are found on the firm’s income statement, while payables are booked as a liability on the balance sheet. Proper double-entry bookkeeping requires that there must always be an offsetting debit and credit for all entries made into the general ledger. To record accounts payable, the accountant credits accounts payable when the bill or invoice is received.
Automation allows businesses to expand without increasing the workforce while reducing the past pain points that plagued Accounts Payable. Over the last decade, nearshoring has emerged as a popular alternative for North American businesses. The P2P offshoring market alone is expected to grow at a compound annual growth rate of 2.6% over the next five years.
By partnering with an experienced outsourcing provider, your organization can benefit from their expertise and technology to streamline this function. Outsourced accounts payable services offer extensive reporting capabilities that provide valuable insight into your financial operations. This includes producing customized reports on invoice processing, payment status, cash flow analysis, and vendor performance to support your decision-making processes. However, accounts payable automation may not be suitable for all businesses, as it may not offer the same level of human oversight and adaptability as outsourcing accounts payable processes. Additionally, implementing accounts payable automation software may require a significant initial investment (or recurring SaaS fees) in software and training of in-house employees.
