Managed Payables Reinforcing Your Fleet Supply Chain

Robust Payment Networks Help to Stabilize Your Fleet

The trucking industry is one of the most challenging businesses in the country, especially at a time where a driver shortage is at critical mass. According to the National Association of Small Trucking Companies, only 15% of newly formed companies make it to their second year of operation and those that do, still struggle. What has become crystal clear is that there is much more to the business of trucking than hauling loads. While safety, insurance and financial management rise to the top when considering the three most important aspects of business, fleet managers across the nation are putting a concerted effort into how they are paying the bills. As they are focusing on the most efficient AP solutions, they are finding that an integrated and managed payables are the answer.

At a time where honest and strong relationships not only reinforce and retain driver commitments, the same effort can also help to build trusting vendor relations, which in turn helps to stabilize and strengthen the overall fleet supply chain. A managed payables system is one aspect of business that can add efficiencies to help secure both business for you, your vendors and your contractors. Critical areas to pay attention to in evaluating Accounts Payable Processes and productivity are as follows:

1. Costs—It’s important for businesses to identify the cost associated with processing each invoice as it stands currently. This includes not only the tools you use, but also the hourly cost of any laborers.

2. Software automation—It’s important to compare the automation your business uses to industry standards. This makes it easier to identify whether you’ve chosen the right tool to handle your unique environment. Statistically, automation has made a big difference, with more than 40 percent of respondents in one benchmarking study saying that workflow tools and imaging are crucial to their operations. More than 25 percent of all firms surveyed use electronic invoicing.

3. Rate of error—On average, 3.6 percent of all errors contain errors. This statistic highlights the importance of ensuring your own error rates are within industry standards. While you’ll never be able to completely eradicate all mistakes, making strides to reduce error rates can make a big difference.

4. Risk of fraud and duplicate payments—Businesses face an increased risk of fraud, with one study revealing that almost 36 percent of companies suffer check fraud. Through benchmarking, businesses can learn what controls they need to put in place to reduce their risks.

5. Risk of duplicate payments—Duplicate payments can be as costly a problem as fraud. For those who see duplicate payments on more than .5 percent of all invoices, it may be a sign that more rigorous controls need to be put in place.

6. Satisfaction of trading partners—Ultimately, the biggest measure of an AP department’s success relates to its vendor satisfaction levels. Many businesses benchmark this area through the use of satisfaction surveys that regularly provide the feedback they need.

Once you have a good understanding of the priorities, you can implement the most effective strategies and those strategies most likely include technology. Payment Leader EFS has built a strong foundation in payment as well as a sophisticated understanding of the trucking industry. Their expertise has enabled fleet managers to focus on the logistics of trucking as apposed, to the logistics of payment. That does not mean fleet managers are giving up the responsibility. It just means that they can rely on a partner to get it done right in order to develop and grow the fleet supply chain. Utilizing robust software solutions can do even more than create efficiencies for getting people paid. EFS offers a comprehensive system that addresses any requirement a customer or vendor might have, so it is easy to see how this kind of technology can strengthen both company and client.

While managed payables are becoming more accessible, the EFS approach consists of 4 critical components that make up one of the most robust AP systems in the industry.

• Systems and Technology: A world-class payment platform that operates in a distributed and virtualized environment with redundant and divergent networks and data centers, providing flexibility that enables increased stability and reliability of a highly scalable systems. The unique system architecture enables highly-customized application development which is the catalyst for continuous customer improvement.
• Continuous Customer Improvement: The core philosophy that drives innovation with continuous upgrades to systems in order to better serve customers. EFS is unique in that they make 90% of all custom application development available to all of our customers, so with each new customer, the systems and technology get better and better!
• Integrated Payments: EFS delivers a completely connected view of business with direct real-time integration into existing transportation management system (TMS). A real-time interface offers complete visibility, complete efficiency and complete control over managing payables inside each business.
• New Product Innovation: By leveraging unique systems, technology and direct customer feedback to drive the product development process. The company is continuously innovating and upgrading to help their customers remain competitive with the latest cutting-edge technology solutions.

While many companies understand that relationship is everything, many more do not know where to start short of communications. With the help of companies like EFS, the industry understands that it is the long-term experience and engagement that really helps to solidify those relationships. They also understand that each relationship along the fleet supply chain is no less important than the next. Each relationship plays a part in the success of the process and companies like EFS are making that process easier through a managed payable process, which in turn is growing business and providing peace of mind.

Resources:

Mastercard

https://pyrus.com/en/blog/accounts-payable-workflow-management

http://www.centreviews.com/2017/08/efficient-youre-ap-department-guide-improving-productivity/

www.apexcapitalcorp.com/blog/is-the-trucking-business-profitable/