The biggest accounts payable (AP) pain points we’ve identified for media agencies revolve around manual processing. If you haven’t yet automated your AP process, you’re likely executing social media campaigns for clients, buying ads across Facebook, Google, LinkedIn, and YouTube with one plastic credit card, and when you’re not using the company credit card, you’re using paper checks to pay for other vendor expenses.
The goal of every company is to harness efficiencies that support business growth. The problem with paper checks and traditional plastic cards is that they fundamentally lack efficiency. Typically, social media ads that are charged on the corporate card are not just for one campaign. There could be charges across several different clients and multiple campaigns, which means at the end of the month the AP department is going through the credit card statement manually, line-by-line, to reconcile each charge.
For paper check payments, it may be taking you hours to process a check run on top of weeks before it is finally delivered and you’re able to reconcile your accounts. Paper checks also statistically put your business at a significantly higher risk of payments fraud, delayed payments due to lost checks, and reconciliation issues resulting from duplicate payments.
All of these potential issues are still accompanied by a few pretty pennies. It costs money to print, stamp, and mail a check. In some cases, it’s also costing additional fees charged by the bank for processing paper checks on their end.
These traditional payment options present arduous manual processing that can take weeks on top of the costs that can be measured both monetarily and in terms of the value associated with employee time and productivity. It may also be difficult to keep track of where you are against the campaign budget when there are multiple credit card users.
AP automation solves these problems. The more media agencies that learn this, the more they love it. We’ve talked to more than a few CEOs and CFOs that have abandoned manual processing and crossed over to the promised land of corporate payments. These are the top three reasons media agencies love AP automation.
1. One Card Per Campaign or Client
It’s hard to say which reason is most loved, but it certainly starts with the virtual credit card capabilities associated with AP automation. Ghost cards, which are a type of virtual card, are extremely popular in the media industry, particularly with social media ad payments. One card can be created per campaign or client with spending parameters built right in, so you never have to worry about going over budget even if there is more than one employee making charges on the card. You also don’t have to worry about going through the statement at the end of the month line-by-line.
Virtual cards also replace paper checks and create an automated one-time payment for the exact amount of an issued vendor invoice. Virtual credit cards and ghost cards simplify the reconciliation process, eliminate the opportunity for late payments, fraud, and duplicate payments, and ensure that your vendors are paid promptly every month. What’s not to love?
2. No Manual Processing
There’s no easier way to say it; once you’ve automated AP there will be no manual processing. You will no longer need to perform manual reconciliations and you won’t be processing payment batches by hand. The time saved is exponential, with many companies reporting that their overall payments process was reduced from weeks to just hours.
Today’s AP automation technology is very intuitive. It doesn’t require an initial investment to set up nor does it require any changes to the workflow you and your team have grown accustomed to. It has become as simple as providing a single file of payments to your AP automation provider. After that, every payment type can be automated.
Once the system is in place, which takes approximately two weeks and three quick phone calls, your vendors will be receiving payments like clockwork, your campaign expenses will be broken down on individual cards, and the entire reconciliation process will be automated through the system.
3. Time and Money Saved
There are multiple ways that AP automation saves time and money and can help you build a stronger business that is primed for growth. Automating reconciliations frees up employee time to focus on higher level activities. Eliminating paper checks reduces the costs associated with printing, mailing, and bank fees. Taking the potential for fraud out of the equation also stops the drain of resources in both time and money spent recovering loses. For most media agencies we’ve worked with, this extra time and money can easily be redirected to other parts of the business, generating new revenue and subsequent growth.
Don’t take our word for it. Read what other media agencies are saying about AP automation.
