How to Save Money with PAYABLES ACCOUNTING?

What are Accounts payable?

Accounts payable refers to the amount you owe for the credit purchase of items. Whenever your business purchases goods or services on credit, the outstanding amount payable for these goods and services is shown in your accounts payable balance. The amount is payable to the creditor within a specific timeframe. If the outstanding amount is not paid within the time limit, late fees are applicable for delay in payment.

Payables Accounting

Payable accounting and its management are important business processes as it reflects the capability of the business to meet its payable obligation effectively. The accounting for accounts payable includes recording and payment of the liabilities. The process of payable accounting begins with setting up charts of accounts that help to post expenses in the appropriate account. The key payable accounting process includes verification of invoice, recording of the invoice, payment of the invoice, and other activities related to AP. As a business owner, growth and expansion are your top priority. A business need to equip itself with accounting software and accountants to handle their payable accounting. It will require your time and money. Outsourcing payable processing to professional experts like us is the best solution to save your time and cost. Proper management of accounts payable can help to save money. There are plenty of opportunities where you can cut your cost and make your business more profitable.

Check below some of the ways to save money with payables accounting.

• Early payment perks:

Early payment to your vendors helps to develop a good business relationship. Even vendors may offer discounts if paid before the due date. So, it is better to set up a reminder to prioritize these payments. You can even set up automatic payments for this vendor, so you never lose an opportunity to save.

• Avoid credit card surcharges:

Credit card surcharges can take a big chunk out of your budget. If you study in the consolidation of payment you can save money by avoiding credit card surcharges. Moreover, it would also consume your staff’s time and efforts. So it is better to look for other modes of payment.

• Opt for paperless invoice:

Managing the accounts payable process is easier with electronic invoices. It eliminates the requirement of mail to receive the bills. Moreover, paper invoices can be lost or damaged. Online bills ensure timely payment and avoid late fees. It saves the human time involved in sending, collecting, and reconciling the invoices for payment.

• Lower freight charges:

The vendor may include freight charges in the invoice bill, which can add up to the cost of business. You can consider paying directly to the carrier instead of to the vendors. You can save your cost by negotiating with multiple vendors to secure the most economical pricing.

• Switch to online process:

Moving to a digital platform like cloud accounting software can have some 70% to 80% of the administrative cost. Considering the labor supply costs and processing time, your business will save thousands of money every year by online processing of accounts payable. Whether it comes to outsourcing your AP or finding more ways to save your money with payable accounting, Meru Accounting strives to provide a customized business solution.