One of your best allies in the struggle to survive today’s credit crunch might be just down the hallway or across the room from your desk: Accounts Payable.

Sure, you already work together in many ways. You’re certainly not working against each other.

But there are three ways you can reinforce the bonds that keep this team performing at a high level.

The final result is a win-win-win: Procurement, A/P and your entire company all benefit.

• Get on the same page. One of the biggest problems in getting payments in or out of your business can be invoice keying errors. Even the best number-punchers and crunchers will occasionally tap the wrong key — sometimes that’s all you need to create a large headache. Try this: Ask suppliers to repeat purchase order numbers back to buyers when placing phone orders. At the same time, include a clause in your contract that requires suppliers to match up invoice line numbers to line item numbers.
• Finding the best terms. Given today’s business conditions, you might want to re-open the door on negotiating standard payment terms with suppliers. Team up with your A/P folks to identify optimal payment terms. Are there early payment discounts you should be taking advantage of? Are there ones you might want to stop?
• Notify the proper authorities. It seems every business has its share of renegade (non PO) transactions, which inevitably fall to A/P for resolution. Catalog these strays and make sure each group is getting the proper review necessary before approval. This increased visibility has been proven to reduce renegade buying and save businesses money.

Tags: A/P, accuracy, discount, invoice, suppliers