The consolidation of a business’ supply chain is not something that is necessarily on the top of a business leader’s priority list. More often than not businesses are resigned to the fact that they deal with a huge variety of suppliers and subsequently need to manage multiple invoices with different settlement terms. The work required to carry out a full supplier review and consolidate all invoices is often a deterrent to getting a seemingly tedious job done.
However, at BCR Associates we are advocates of this consolidation process as it can often unearth hidden benefits which will be advantageous to your business in the long run.
What do we mean by invoice consolidation?
Invoice consolidation is the process of streamlining your business’ supply chain and making sure that you are working with as few different companies as possible. We take this one step further by setting up contracts with coterminous end dates and making sure that the points of the year that invoices need to be dealt with are kept to a minimum.
Consolidating your company invoices is particularly helpful when you are dealing with a high volume of suppliers across numerous business locations/sites.
- Improved control of invoice payment periods. If your business is working across a reduced number of suppliers and invoices you will have better control of invoice settlement terms. This will help you to plot your business’ outgoings over the financial year, making sure that transactions are processed within the given payment period as stipulated by your suppliers’ Terms and Conditions.
- Reduced time spent administering invoices. Streamlining the number of suppliers that your company works with and the number of invoices that your company needs to process will increase back-office efficiency as your administrators and accounting team will be able to scale back the number of transactions they make each month. This could help to decrease staffing costs and reduce the administrative resource required.
- More favourable credit terms. Consolidating your supply chain and reducing the number of debtors your business has should help to improve your purchasing power and furnish you with favourable credit terms.
- Seamless expenditure planning going forward. By streamlining the number of suppliers that you work with and the volume of invoices that your business processes it will be much easier to keep track of your expenditure over the year. This means that you will be able to set out fixed expenses to near certainty and allow for variable expenses.
To speak to one of our consultants and request a full supplier review, please contact us on: 03330 433 233.