Strong supplier relationships aren’t just nice to have, they’re integral to securing cost savings, fuelling business growth, and building a reliable future for your company and employees. Proving yourself as a dependable business partner goes a long way in constructing a sound foundation for success. 

In this blog, we’ll explore key ways to improve supplier relationships, the importance of paying invoices on time, and how finance automation could be the answer. 

Why are strong supplier relationships so crucial for business growth and longevity? 

To be successful in today’s competitive business world, organisations need to maintain positive external relationships. It can reduce costs and strengthen negotiation power when it comes to securing favourable contracts and fixed rate agreements. Businesses can create a more reliable supply chain, which can help to mitigate the risks associated with volatile market conditions. Key ways businesses can improve supplier relationships include…

1. Ensuring timely payments, allowing suppliers to effectively manage their own cash flow and budget more efficiently for the future
2. Good communication with regular updates
3. Smooth approval processes, utilising automation to manage workflows seamlessly
4. Proactive risk management and mitigation, achieved through full financial visibility 
   
   

How does finance automation help improve supplier relationships?

Establishing mutual respect and trust starts with ensuring invoices are paid on time or early, and in full without errors. If clients know they can rely on you for this, it can help ensure repeat business. With AP automation, businesses can improve supplier relationships and reap financial rewards. In other words, it pays to have good payment processes in place.

Proactively manage vendor relationships
Considering the time-saving benefits of AP automation and its ability to improve employee productivity by 5x, organisations can unlock capacity to focus on business intelligence and other critical tasks. Removing the manual burden of Accounts Payable processes allows finance leaders to focus on proactively managing supplier relationships and identifying opportunities to take advantage of benefits in supplier contracts. This can boost the chances of being awarded discounts or long term contracts. 

Reduce late payments
Late payments can create significant problems within an organisation. Supplier relationships can become strained, cash flow issues may occur, and business opportunities might be lost in the process. With AP automation, finance teams can reduce the risk of human errors occurring and process invoices faster and more accurately. 

Reducing late payments not only strengthens supplier relationships and builds trust, but also helps to: 

• Avoid financial penalties associated with late payments
• Reduce the administrative burden of managing invoices that are overdue
• Power business growth by improving cash flow

Improved communication and invoice visibility 
AP automation software provides full visibility into invoice payment statuses. Finance teams can access crucial insights into payment activities and communicate updates to suppliers in real time. By proactively updating external parties, it can reduce the strain on support lines where suppliers may reach out for support. Instead, AP automation facilitates a streamlined communication process where suppliers feel reassured and updated at all times. 

Discover the return on investment (ROI) of finance automation 

Automated processing reduces costs by up to 90% and can present a number of financial, security, and time-saving benefits. Download our eBook to discover the ROI of AP automation and the significant savings that can be seen.