When Benjamin Franklin said “only two things are certain in life, death and taxes,” he obviously never considered a time when Comcast and Verizon bills would be just as certain. The reality of running a business is that there will always be bills to pay.
That’s where the third question from our series, The Four Burning Questions Business Owners Have, comes in: How much do I owe people?
You can read the posts about the first two questions here: 1. How much money do I have and 2. How much do people owe me.
Knowing how much you owe people, also known as Accounts Payable (A/P) is undeniably important because it enables you to buy products and services that keep your business running. Just as important is having an efficient A/P process, which is what we’ll be addressing in this post. We’d like to bring up our example about Anna, a small business owner with an apple dumpling food cart and kitchen to cater from.
A day in the dumpling life: keeping up with bills
Anna buys products and pays for services to keep her business running, but didn’t realize that all of the resulting invoices would show up in a myriad of ways. She received a utility bill disconnect notice, but didn’t remember receiving a prior invoice. It’s not that Anna wouldn’t have paid the utility bill, it just slipped through the cracks. It became a bit overwhelming for her to manage the payments, and like the smart business owner she is, Anna looked for a better way to do it.
An inefficient A/P process isn’t doing you any favors
As in Anna’s case, it’s hard to feel settled as a business owner when what you owe others can be such a massive time suck. With invoices coming in from a million different directions, and all with different formats and payment instructions, there needs to be an efficient process to capture everything. All of the time you spend on the A/P side of invoicing isn’t earning you any money because those payments are going straight to another business.
An inefficient A/P process will also disrupt the flow of your business and vendors may start refusing to work with you. Good thing for Anna, and every other business owner out there, there is a solution to having an efficient A/P process. It’s called modernizing!
Modernize your A/P process
There are two parts to modernizing your A/P process. First, you need to focus on capturing the data from the invoices. In order to modernize the process, the information has to be converted to digital format and we suggest using Hubdoc to do this. Getting all of the data into one system is the hard part, but it will make management of the process much easier.
The second part of modernizing your A/P process is processing the data you’ve captured. From Hubdoc you can commit to modern payment solutions like Bill.com or Xero that simplify bill paying. It’s time to start saving time.