The goal of P2P automation is to use the power of digitalization to increase visibility over the P2P cycle as well as to streamline it by reducing paperwork. One specific area where automation can be very helpful in the P2P cycle is in the accounts payable phase. Unfortunately, despite there being many different kinds of automation solutions available, many businesses continue to rely on paper-based processes to manage their invoices and pay their suppliers.
This has many downsides. First, these kinds of processes are not scalable. Your business may go through a period of high growth and start processing more transactions. But that can cause your accounts payable team to become buried under mountains of invoices that will most likely end up getting paid late. Late payments can then be detrimental to your relationships with your suppliers, causing more headaches. These are just a few of the problems that arise when doing accounts payable manually.
If you were to look at any market guide for accounts payable invoice automation solutions, the best option for middle-market businesses would most likely be AvidXchange. AvidXchange possesses an entire suite of products and software solutions designed specifically to improve your accounts payable processes. We enable you to bring the power of automation into your accounts payable department so that you can clear all those papers off your team’s desks. With AvidXchange, you can code, approve, and pay invoices in just a few clicks, sending payment instantly to your vendors instead of making them wait on slow mail deliveries. Our P2P automation software allows you and your team to spend more time growing your business and less time filling out paperwork.
P2P Automation Meaning
Now, you may still be wondering, “What is the P2P automation meaning?” Basically, P2P automation refers to a kind of software that makes the processes within the P2P cycle simpler and more efficient. Procure-to-payment eliminates the siloing effect that occurs all too often when departments isolate themselves from each other. By utilizing automation solutions, you can more easily connect and gain visibility into the entire P2P cycle. This can also help with supply chain management, as you will have a better understanding of what is happening with the supplier transactions within your business.
When it comes to the procure-to-pay process, SAP can be a very useful software solution that can aid in making the procurement process more efficient. But what is SAP procure-to-pay? SAP is useful for accounting and other phases in the cycle. Even with an SAP solution, however, you still will be swamped with paperwork at the end of each transaction, leaving your accounts payable team scrambling to keep up. Fortunately, there is procure-to-pay software designed to benefit your accounts payable department. It’s called AvidXchange. One specific solution from AvidXchange is AvidPay. AvidPay allows you to completely automate your bill payment processes and workflows and pay your vendors electronically. Our platform enables you to switch to paperless bill payments and create custom workflows, and it is already trusted by over 825,000 suppliers and vendors across a multitude of industries. With AvidPay, your existing accounting system will remain your system of record, but payments can be made instantly through our easy-to-use interface. AvidPay has the capability to speed up your P2P cycle by making the “pay” element simple, fast, and easy.
Top Procure-To-Pay Software
What is procure-to-pay software? Procure-to-pay (P2P) software connects the procurement phase to the accounts payable department, allowing you to get a holistic view of the purchasing life cycle within your organization. Any program or tool that simplifies or automates any aspect of the P2P cycle helps to accomplish this objective and could be considered procure-to-pay software. In the procurement phase, a company negotiates with the identified source to agree on a price for goods or services the business needs. Then, the products are delivered to the business. After that, the supplier or vendor sends an invoice to the business, which is then coded, approved, and paid for. That is a simple description of the P2P life cycle.
Generally, the top procure-to-pay software will be both versatile and highly usable. When it comes to the beginning of the cycle, the best procurement software includes automation features to make your life easier as well as robust supplier management features. The best procure-to-pay companies offer software that is cloud based. That’s why AvidXchange has designed all of its solutions to fully enable cloud functionality. Because the platform is in the cloud, AvidXchange allows you to gain 24/7 visibility and access to your accounts payable processes so you can always know exactly what’s going on. Because of its security, reliability, and effectiveness, you can expect to find AvidXchange on any procure-to-pay software list.
Procure-To-Pay Automation Benefits
There are many procure-to-pay automation benefits. That’s why so many companies have started turning to procure-to-pay transformation and digitalization. One great procure-to-pay example of accounts payable software is AvidPay from AvidXchange. Looking at some of the benefits of procure-to-pay systems like this can be a great way to understand just how helpful procure-to-pay software can be. For starters, paper processes have all kinds of costs that digital transformation can eliminate. Electronic payment systems are also far more secure than paper-based processes. It is far easier to forge a signature on a check than to hack a highly secured online payment system. Plus, because AvidPay is cloud based, it supports remote work, one of the most important trends in the workforce today.
The objective of the procure-to-pay process is to make the entire purchasing process better. AvidPay from AvidXchange does that by giving your accounts payable team the ability to foster supplier relationships by always paying invoices on time, as well as ensuring that your team is always prepared to scale up with growing workloads. Although you may have heard of the term “order to cash,” it is not the same thing as procure to pay.
When it comes to procure to pay vs. order to cash, the simplest way to describe it is that the “other side” of order-to-cash transactions is a customer, while the vendor is the other participant in procure-to-pay transactions. P2P is more about purchasing supplies, while O2C is about sales. Although they are similar, their functions are very different. You may also hear about source-to-pay benefits as well. Source to pay is also similar to procure to pay but goes back a step further to the sourcing phase of a supplier transaction. In this case, a source-to-pay solution would bring benefits that would make it easier to identify the best suppliers in the first place, as well as all the other benefits we have discussed.
As we have already mentioned, the procure-to-pay cycle (also known as purchase-to-pay) covers the fundamental process of a business inquiring, requesting, receiving, and then paying for raw goods and services. The P2P cycle is of immense importance. Without it, it really wouldn’t be possible to do business at all. This is why the current global procure-to-pay market size for software is currently valued at several billion dollars and is only projected to grow. Companies are looking for purchasing software as well as accounts payable platforms that can help them streamline their procure-to-pay cycle. Right now, there are many snags and inefficiencies in the processes that make up the procure-to-pay cycle in most businesses. Using software, companies can alleviate the issues so that they can purchase goods, receive and track them faster and better, and then get those goods paid for consistently on time.
Procure-To-Pay Best Practices
There are a couple of procure-to-pay best practices you should be aware of. For one thing, standardization is crucial. By ensuring that your P2P processes rely on written-down policies and guidelines instead of individual employees, you are building a process that is less vulnerable and more stable. Another best practice is to utilize procure-to-pay software. Software platforms like AP automation can make it much easier to drive greater standardization of processes, support collaboration, and ensure greater visibility over your P2P processes. Incidentally, these are all procure-to-pay best practices.
The procure-to-pay process is very important to any business that relies on getting goods and services from suppliers. For middle-market enterprises, it can be difficult to ensure that the purchase-to-pay process is smooth and efficient every time. One of the best ways to help with this is to utilize an AP automation software platform like AvidXchange. With AvidPay from AvidXchange, you can pay your bills instantly with just a few clicks. Furthermore, because automation shouldn’t mean a loss of control, AvidXchange enables you to create custom workflows so you can ensure complete customization of your bill payment processes.