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Why You Must Read “The Ultimate Guide to AP Automation for Auto Dealerships”

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It’s no secret that your AP department plays a major role in the success of your auto dealership. Not only do its processes impact cash flow and efficiency, but they also impact supplier relationships and your dealership’s ability to scale and expand.

Whether you’re satisfied or not with department metrics really depends on how the work gets done. Have you added technology to improve speed and accuracy, or are manual processes still at the forefront of your AP operations? This is a great question to ask as you explore change because, all too often, manual workloads make timely invoice payment difficult and limit an accounting team’s potential.

With innovation in mind, CloudX has developed “The Ultimate Guide to AP Automation for Auto Dealerships.” It’s a 14-page eBook full of practical insights and ideas on how a good AP automation solution like APSmart combined with a payment solution like PAYSmart can help you digitally transform your accounting department and turn your business into a profit center.

If this sparks your curiosity already, click here to download your free eBook. Or, to get a few highlights from the eBook first, keep reading.

 

 5 eBook Topics to Help Jump-Start Your Digital Transformation

 

Choosing to implement an AP automation solution starts with determining the biggest needs of your AP department and then exploring options and getting stakeholders on board as you make a case for its adoption. Return on investment (ROI) is a major element to consider, as are integration capabilities and overall cost.

Here are some important topics covered in the eBook:

  1. You’ll learn what AP automation does to reduce manual data entry. With built-in optical character recognition (OCR) technology, a good solution can eliminate most manual invoice processing functions. This means your staff will be able to scan and save invoices, set approval workflows, automate GL coding, complete PO matches, and more. Once you add a compatible payment automation solution, you’ll have end-to-end digitization capability that frees up time, money, and FTE.
  2. You’ll understand how to find a good automation solution. Above all, you’ll want to deploy a software that fully integrates with your DMS or accounting system. The technology should allow invoices to sync seamlessly, give full visibility of digitized documentation, automate workflows, and have 2- and 3-way matching capabilities. You also want to look for fair pricing and inclusive customer service that doesn’t charge you additional fees (beyond software) for training or support. 
  3. You’ll find out what payment automation can do for your auto dealership.Automating vendor payments completes the sequence of implementing an end-to-end solution for your dealership. Once set up, your staff will be paying invoices on time, eliminating overpayments, reducing fraud, and much more.There’s something additional worth noting: Auto dealerships have a distinct advantage over other industries when it comes to gathering valuable cash rebates. Why? Because of vendor preference. Many dealerships are already working with vendors active in the B2C space who accept virtual card payments, so there’s no extra footwork required.
  1. You’ll identify which Key Performance Indicators (KPIs) are good to measure and how to measure them.Establishing benchmarks as they relate to KPIs before, during, and after implementation of an automation solution can help you maintain accountability, understand where your staff needs to make improvements, and gauge the solution’s success. A few important KPIs include:

Number of Invoices Processed Per Day. This is a great metric for determining employee productivity and learning which vendors you may be having problems with. Most AP departments can process 5 invoices per day in a manual setting, but with implementation of a good AP automation solution like APSmart, that number can reach 160 or more. The formula for this KPI is:

Number of Invoices Processed Per Day Per Staff=Number of Invoices Processed/Number of AP Staff Performing Work

Cost to Process a Single Invoice. To get an accurate total of this cost, you will need to include all the inputs involved, including salaries, infrastructure, and process time. A 2021 study by Ardent Partners said invoice processing in 2020 with minimal automation was $10.89 per invoice. That cost can be driven down to $2 or $3 with a right-fitting automation solution. Here’s how to determine the KPI:

 Cost Per Invoice=Total AP Costs/Total Number of Invoices

Invoice Exception Rate. In general, a high number here is frustrating because it takes human intervention to resolve these mismatches between invoices and POs. AP automation is helping lower the rate, however, thanks to built-in AI capabilities that lessen or eliminate errors before they even reach your accounting staff.

Invoice Exception Rate=Rate of Invoice Exceptions/Total of Invoices Processed x 100

 

  1. You’ll discover how digitizing and automating across multiple locations helps your dealership.

If your dealership has a decentralized accounts payable department, paperwork may be getting duplicated or lost and invoices might not be getting paid on time. These problems compound your department’s inefficiencies and make forecasting and cash flow analysis very difficult. On the other hand, an automation solution able to support end-to-end functions will help standardize operations, aid in efficiency, and enable future scalability. This convergence allows administrators to have control of every AP process step and makes documents visible across the organization for easy recordkeeping and retrieval.

 

An Excerpt on Accounts Payable Automation From the eBook

 

“If your staff is still manually processing paper documents, you’re in a trailing percentile of AP departments. Investing in quality AP automation software is one of the best things you can do to get rid of time-consuming administrative work because it can automate up to 85% of your AP workflows. With this technology, invoice data moves to an electronic file and then matches it to a purchase order. Automated 3-way matching is also possible between PO, receipt, and invoice. From there, digital documents can automatically be sent to designated parties for approval, authorized for payment, routed to your business’s DMS, and be made ready for payment.”

 

DOWNLOAD THE ULTIMATE GUIDE TO  AP AUTOMATION FOR DEALERSHIPS

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