2019 is the year to focus on growing your business, adding clients and maybe even expanding into new locations, products or services. That means incorporating collaborative solutions that can reduce time and costs that accompany operational tasks like accounts receivable and accounts payable.
These strategies can help payment solutions for your business this year.
As far as payment solutions go, direct deposit is hardly new. However, it has historically been restricted to large businesses. Banks typically offered this service to companies with a large workforce, and there were no options for small businesses.
When small businesses use contract employees, such as freelance talent, the norm has been to send a physical check. This approach can take a lot of time, between writing and mailing each check and manually recording the transactions. On the receiving end, your freelance talent is checking their mailbox, wondering when they'll receive your payment.
Fortunately, banks and online payment companies recognized the need to help small businesses by offering more, faster payment solutions. Now, those small businesses can take advantage of direct deposit through an Automated Clearing House, or ACH. This technology lets you electronically transfer funds from your business account directly into anyone's account, including freelancers and vendors. Even companies with fewer than ten employees can now tap these payment solutions.
Moreover, direct deposit can be used for more than just payroll. If you are a freelancer, you can offer it as a payment option for your clients who may appreciate the convenience. Additionally, your small business can use direct deposit for things such as travel and employee expense reimbursements, tax payments, bonuses and commissions.
Recurring Payment Dates
Adhere to a disciplined schedule by setting specific days on a monthly or weekly basis to handle both AP and AR, instead of fitting these tasks in on an ad-hoc basis. This streamlines matters so that these complex tasks don't take up more time than necessary. Expand this strategy for your payment solutions by leveraging collaborative solutions that automate this process. This includes using payment tools, such as recurring online invoicing and digital and mobile payment systems.
For AR, your small business can use online invoicing tools. These tools let you automatically schedule certain invoices for delivery on days and at times you designate, alleviating the repetitive drudgery of sending recurring invoices or physically preparing paper invoices for mailing.
Payment solutions can also help you streamline your AP processes. Most, if not all, of your monthly bills can be paid by scheduling payments online through your bank or an electronic payment service. You'll eliminate time-consuming paper processes, while simultaneously increasing cash flow by scheduling payments throughout the month to coincide with your revenue.
Many of these collaborative solutions also integrate with other tools and platforms to further reduce the time you spend on operational activities. In addition to the time you save by scheduling invoices and bills to be handled automatically, accounting software is also updated to reflect these recurring actions.
Business Credit Cards
Look for and use business credit cards that itemize all expenses and provide downloadable data that integrates directly into your accounting software. Whether you want a rewards card, travel benefits or a longer time period for repayment, these collaborative solutions for payments offer ways to reduce your record keeping and payment tasks.
Additionally, providing trusted employees with their own business credit card streamlines expense tracking across the company and allows you to skip the reimbursement process entirely. Their expenses can also be downloaded into the company's accounting platform to speed reconciliation and spend analysis.
Adhere to a disciplined schedule by setting specific days on a monthly or weekly basis to handle both AP and AR, instead of fitting these tasks in on an ad-hoc basis.
Where to Start Streamlining
Before your small business takes advantage of these payment solutions, first determine which align with your unique needs. Assess how much time you currently spend on AR and AP and account for the expenses associated with any manual payment processes you still use.
You'll need to base decisions on factors such as the number of monthly payments you need to make, the costs associated with the payment solutions, and what would enhance the customer experience of doing business with your brand. Survey employees, freelancers and customers to learn what type of payment methods help them get paid in a way that also meets their goals.
For example, if freelancers are asking you to pay their transaction fees, it may be advantageous to you and them to switch to direct deposit options that are often fee-free. Alternatively, if you are rapidly expanding your team and they travel frequently, then business credit cards will facilitate those payment activities.
If you are looking for ways to free up more time in order to build your business, these streamlining tactics and collaborative solutions will help. Then, you can shift your focus towards other money-making projects at your company.
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