Why Keeping Control of Your Cash Flow is More Important Than Ever – And How To Do It

Naomi Hamlin |

Business cash flow is always vital. Over 80% of failed small businesses say they collapsed because of cash flow problems. It isn’t just small businesses, either. We’ve also witnessed giants such as Carillion and Greensill Capital fail when the cash ran out.

The spotlight is on cash flow now more than ever, especially with continuous fluctuations in the economy. But how do you go about gaining more control of your cash flow?

The Cash Flow Quandary

The difficulty in gaining control of your cash flow goes right to the heart of your role. Because as a finance leader, you need to look forward and look back.  The operational side of your role involves looking back to pull figures together to report on progress.

At the same time, to take control of cash flow and take a strategic role in the future direction of your business, you’re required to look forward.

The trouble is that you need the data you get from looking backwards to be able to look forward. But in a paper-based process, looking back to gather data takes so much of your time you aren’t able to give the future the attention it needs.

What’s more, the data you’re gathering doesn’t always give you the level of insight you need. Because to make robust decisions and give strategic advice, you need quality information, timely information and visibility of information, all of which are harder to achieve in a paper-based process.

The solution is to make the operational side of your role much more efficient – and this is where AP automation can help.

How AP Automation Gives You More Control of Cash Flow

SAP Concur customers tell us they see several key gains from AP automation as it relates to cash flow.

There are the time savings that result in increased efficiency, which frees up time to spend on strategic activity such as cash flow management.

  • Invoices enter the system automatically so the finance team spends less time on rekeying data and  processing invoices. Accuracy is also increased because there’s less risk of human error in the process.
  • Approvals can be done on mobile devices or when working remotely, so the process can move much more quickly.
  • Policy is applied automatically, which supports compliance and reduces the risk of fraud. There are fewer lost invoices. There’s a clear, complete cloud-based audit trail for every item and everything is recorded in full in the same way.
  • You also gain the tools to focus on the proactive control of cash flow.
  • There’s enhanced visibility of liabilities and accruals. It’s easier to prioritise supplier payments and take strategic decisions on when to pay because invoices have been processed in a timely manner rather than at the end of – or after – the payment term. And because information is available in near real-time it means decisions can be made based on how things are right now rather than as they were a week or a month ago.

AP Automation Helps You Take Control of Cash Flow and Move the Business Forward

AP automation is invaluable for helping you gain control of cash flow and focus on driving the business forward. Because the pace of change these days means that if you aren’t moving forward, you’re going backwards. AP automation gives you some of the tools you need to cope with today’s unpredictable landscape.

To find out  how to protect your cashflow more effectively please read our infographic 11 Ways to Protect Your Cash Flow.