Four Signs Your Vendor Payment Process Needs an Upgrade

As a business owner, you’re likely making regular payments to vendors for raw materials, production supplies, or even transportation to keep business operations running smoothly. But the vendor payment process can be difficult, as business-to-business (B2B) payments have not advanced as quickly as consumer payments have.

If one or more of the following scenarios sounds like something you experience on a regular basis, it’s time to consider updating your vendor payment process to a smarter solution.

1. You’re Still Using Cash

Cash used to be the go-to payment method for all types of purchases, in both the consumer space and B2B. However, as technology advances, paying with cash has become a method of the past, and for good reason.

Taking out large sums of cash from the bank can be difficult, with account rules and restrictions in place that work to keep your money in your account. It’s also incredibly easy to lose cash, or lose track of if the vendor actually received it; and if it does get lost, there’s no way to get it back. On top of all of this, the same difficulties that cash poses to you it poses to your vendors.

2. You’re Still Writing Cheques

Cheques are the most traditional vendor payment method, and are still frequently used today. But cheques can be troublesome not only for the vendor receiving them, but for you as well. Getting a cheque to a vendor requires either manual pick up or mail delivery, which adds time and inefficiency to the payment process. Then there’s effort required from the vendor to take the cheque to the bank, and the waiting period for it to clear and process into their account.  

And similar to cash, cheques are a single piece of paper that come with a lot of liability, as they can be easily misplaced, filled out incorrectly, or damaged.

3. Your Payment Process Takes Time Away from Business Operations

Your vendor payment process should be one small part of your business operations, not something that takes time away from important tasks. If paying your vendors means trips to the bank, post office, or even to see them in person, you should consider alternative methods that don’t eat away at the important hours of your day.

4. You and Your Vendors are on Separate Systems

If you and your vendors prefer to manage payments differently, it can add an unnecessary level of complication to the overall payment process. If you prefer cheque but your vendor prefers e-transfers, your cheque may be sitting in an accountant’s mailbox for weeks while their other payments funnel through online. Or, maybe you prefer to pay in cash, but your vendor uses an accounting software and doesn’t have an employee responsible for bank deposits. Being on one consistent system helps to avoid many of the problems that can arise when using multiple channels.

If any of these four problems sound like something your business runs into on a regular basis, it’s time to update your vendor payment process. To learn more about Moneris’ B2B payment options, take a look at our article A Payment Method Worth Buying Into: Four Ways Commercial Payment Cards Benefit Suppliers or The Cheque is Not in the Mail: Why Modern Payment Solutions Make Sense for Canadian Companies!

The information in this article is provided solely for informational purposes and is not intended to be legal, business or other professional advice or an endorsement of any of the websites or services listed. 

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