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E-Payments: Understanding the Last Mile of the Automation Process
Over the past few decades, we have seen constant advancements in automation technology, particularly when it comes to the hospitality procurement process. Procedures like sourcing, tendering, auctioning, and ordering products have all been adopted into automated systems. And while these advancements have created unmatched levels of consistency, efficiency, and convenience, there’s one area in particular that often gets left out of this automation: payments.
For years, organizations have relied on legacy payment processes like paper checks and manual purchase tracking, invoice matching, and inventory management. While many argue that these old-school payment methods are more convenient due to their longevity, manual payment systems have become increasingly expensive, far less secure, and more susceptible to attacks from cyber thieves.
While we enter into a new era of automation, it’s crucial to not only acknowledge the use of this technology in various procurement processes, but primarily in payment. As the proverbial last mile of the entire procurement process, one wrong step in payment can result in an entire procurement system breakdown.
Automated Payments Reduce Back-Office Headaches
The process of switching from manual to automated systems has undoubtedly been a challenging one for many in the hospitality industry. There are a lot of key areas to consider, like managing procurement, selecting and purchasing the right products, and managing invoices. As companies have worked to build and implement a highly-specialized automated system for these areas, many have overlooked the final crucial step of payment.
Kris Herrin, General Manager of Payments at BirchStreet Systems, explained this phenomenon regarding e-pay, coining it as “the last mile” in a recent interview. “You have just built all this great automation, and at the very end, fall back to a legacy payment process…That is the last mile…When that last mile breaks down, it causes a lot of headaches for properties and the back-office.”
But Herrin goes on to say that this gives companies an opportunity to push automation a step further. “Payments are the last step in this process. You have done all this great work in automating, and you have reached the last mile where you need to pay your vendor and supplier, make sure they get their money, and ensure they apply it to your account.”
With an automated e-payment system, your back office can benefit from faster, more seamless invoice processing cycles. You no longer have to worry about suppliers or vendors receiving payments on time. This system allows you to know exactly when payments are processed, enabling you to monitor the entire transaction process—which will help keep cash flowing and allow you to plan ahead.
Greater Fraud Prevention and Less Error-Prone
One of the biggest downsides to manual billing systems is the increased risk of fraud and error.
Financial fraud is becoming more rampant in the hospitality industry. The number of attacks that bait unsuspecting victims into handing over bank account data, social security numbers, and credit card information is multiplying, so it’s crucial to obtain a secure payment system for your organization, your clients, and your suppliers.
With an automatic system like e-pay software, you can obtain a higher level of payment security that encrypts sensitive financial data, making it a safe and secure payment option. Plus, most e-payment systems will alert you on any suspicious activity—such as a potential scam—allowing you to guard your payments against attacks at the earliest sign of risk.
Likewise, manual payment processes create room for human error, which can cost thousands of company dollars—and hours—to remedy.
An e-payment system minimizes this risk by removing the need to manually enter data, pay a large number of suppliers’ invoices by hand, or transfer physical documents involving payment details. Instead, you can digitize the entire payment process from beginning to end, not only freeing up precious employee time but reducing the chances for costly human errors.
Seamless E-Payments Create Better Supplier Relationships
As the last mile in procurement, your payment process is more crucial than you may think. Everything in the procurement process weighs on how well your payment method is executed. Just as Herrin pointed out earlier, one misstep in this final process can result in a colossal breakdown in the entire procurement system.
Not only is this an important aspect of the internal workflow of your company, but it’s also crucial in maintaining strong supplier relationships.
A well-oiled e-payment system should allow your suppliers and vendor to rest easy knowing they’re receiving payments on time and in the right manner. But if your manual payment system is prone to fraudulent checks, late or incorrect payments, or other disruptions, suppliers will not feel like they can trust you as a reliable business partner and may be more likely to look elsewhere for your services.
With e-pay, you can give your suppliers full visibility into their payments and transaction details, giving them greater confidence, they are being paid both consistently and on time. When suppliers feel like they can trust you, a strategic relationship being to take shape, and such a formidable bond can make all the difference when disruptions occur or unexpected crises arise.
Explore BirchStreet’s Automated Payment System
At BirchStreet Systems, we are passionate about advancing procurement processes like payment for the future of automation.
By implementing the BirchStreet Pay e-payment solution, you can simplify and expedite the transaction process from beginning to end, reducing margins for error and back-office headaches. With multiple secure payment options to choose from—ACH, check, and vCard—your company can harness the power of smart-pay technology to simplify procurement across various departments and locations.
Furthermore, this solution gives you full insight into spending and compliance processes—allowing you to ensure all transaction details are accurate and suppliers are paid quickly and securely.
About BirchStreet Systems
BirchStreet Systems powers hospitality and food and beverage enterprises with a comprehensive procure-to-pay business solution. As the global leading provider of spend management solutions in the hospitality industry, 15,500 enterprises in over 130 countries subscribe to BirchStreet to connect with a network of more than 450,000 suppliers.
Established in 2002, BirchStreet is privately held and is headquartered in Las Vegas, NV with offices in California, China, Singapore, India and the UK. For more information, please visit www.birchstreetsystems.com.
Contact: BirchStreet Sales: sales@birchstreet.net / 949-881-5981