Do you think of A/P as purely a cost center? Here are some techniques you can suggest to help the your A/P staffers bolster the bottom line.
Where A/P can save cash
Money has to leave the company A/P – that much is a given.
Here are a few out-of-the-box ways A/P can save money and improve performance department-wide..
1. Stay in touch with Purchasing. A/P staffers know exactly what’s being spent and what was spent in the past.
This is all extremely useful information for Purchasing when shopping around and negotiating
A/P staff should offer to look up old payments upon request. Knowing what was previously paid can help your company secure a better price in the future.
2. Use evaluated receipts settlement (ERS). Originally pioneered by General Motors, ERS eliminates the need for invoices. In the simplest terms, a company creates a purchase order and pays after confirming all the goods have been delivered.
Even if you only use ERS with a few vendors, it could still save you valuable time and resources. Keep in mind, because of the lack of invoice, folks in other departments need to be properly trained to make this system work. You can learn more at bit.ly/ERS411.
3. Keep your metrics posted – and updated. This one is the most obvious, but it could also have the biggest payoff. By keeping your metrics posted where everyone can see them, A/P staffers just might stay motivated to improve.