Life After AP Automation: What To Do With The Time You Get Back
by Jillian Straw
Paying your vendor invoices is probably one of the top priorities on your to-do list. Your invoices constantly demand your attention because, of course — you need to pay them to run your business.
But invoice processing is just one of many areas of your restaurant. If you are able to save time through an automated Accounts Payable (AP) system, you can use the hours usually spent on invoice processing instead on other areas of restaurant operations. Less time spent on invoice processing is more time for strategies that can benefit the long-term health of your business.
Automating the time-consuming aspects of Accounts Payable can add efficiencies into your accounting, and it also has ramifications across company operations. So how does automating AP save you time, and what should you do with that time when you have it back?
The Time Trap of Manual Invoice Processing
Each step of the manual invoice processing can be streamlined through AP automation. Once you see the efficiencies you have to gain, you may be surprised by how many hours a week your team can instead use for other activities.
Inputting and tracking invoices
Your restaurant is receiving a large number of invoices every week, via email PDFs, Electronic Data Interchange (EDI), vendor portals, or paper invoices. Keeping track of these invoices, sometimes quite literally moving paper invoices hand to hand throughout your company, can take up a lot of time.
An AP solution allows you to upload invoices in bulk, no matter the format, snapping pictures of invoices to transform them into digital documents. It removes the time-consuming step of tracking, printing, and organizing invoices from multiple sources.
Manual GL coding
Coding your invoices for your general ledger (GL) by hand is the same repetitive task, every week. Your team is in the back office, typing data from invoices into a laptop, instead of spending their time on more important tasks. Manual data entry is not only time-consuming, but it also can lead to incorrect entries that cause operational issues down the line.
An AP solution can automatically capture line-by-line details on your invoices, digitizing info like product names, quantities, and costs. Once you match your invoices items to your chart of accounts, the next time those items are processed, they will be automatically correctly coded to your general ledger. Any remaining coding on outlier items can be done quickly by your team, freeing up hours each week.
Whatever the approval process in your organization, tracking down approvers in the fast-moving restaurant industry is never an efficient process. Stacks of paper invoices, or emails loaded with attachments, require tedious attention. And with a burdensome approval system, your team can lose time overall when it isn’t clear where invoices are in the payment process.
With an invoice automation solution, you can create customized workflows to route invoices to the correct approvers. Create complex rules based on any piece of line item data, like vendor or invoice total, to match your company’s needs and replace manual approval.
Printing and mailing checks
Processing vendor payment via paper checks is one of the last steps in a long process. Your staff needs to print checks, stuff envelopes, pay for postage, and track mail through an occasionally slow and uncertain delivery period.
Through a centralized platform like Plate IQ’s VendorPay, you can instead pay all your vendors directly through one solution, leveraging ACH, virtual cards, credit cards, or even checks printed and mailed by Plate IQ. You can also reconcile your invoices faster, using a centralized platform to flag missing invoices and discrepancies and emailing vendors directly from the dashboard.
Inefficient paper systems of record
Your team doesn’t need to spend their time shuffling paper around in filing cabinets. Finding old invoices and tracking data with a paper system can be inefficient and frustrating.
A digitized invoice archive replaces filing cabinets filled with paper, while also making your invoice data centralized and searchable. An AP solution like Plate IQ securely stores your invoices for up to seven years, offering long-term, easy access to your invoice record.
Next Steps After Implementing AP Automation: How to Spend the Time You Get Back?
There are many important areas of restaurant operations that can fly under the radar, simply because they aren’t urgent day-to-day priorities like tackling an invoice. With the time that you can get back from automating your AP process, you can focus on other critical areas that will affect your restaurant’s success.
Evaluate Vendor Prices
Your vendor prices have an enormous impact on your overall food costs, so it’s a good practice to build a regular review of vendor prices into your operations calendar. In a November 2021 survey conducted by the National Restaurant Association, “91% of operators said their total food costs (as a percent of sales) are higher than they were prior to the COVID-19 outbreak.” Especially as inflation impacts the overall economy and occasional supply chain disruptions are increasing food prices, staying on top of your vendor pricing is essential.
First, having accurate historical price data in hand can help you decide where to focus. With a solution like Plate IQ, your digitized invoice data is organized and searchable. Through the Items dashboard, you can easily view historical prices to spot any anomalies and large changes. The tool is especially useful to verify vendor compliance with any contracted price ranges, or to help you decide what food categories to start examining first.
If you do want to engage with your vendors for better pricing, it’s great to be armed with your pricing data in hand. While this doesn’t mean you are planning on haggling over every item (you do want to keep a good relationship, after all), letting your vendors know that you are keeping a close eye on pricing can help ensure they stay engaged with your account.
Develop Strategic Menu Adjustments
A strategic menu is a large component of maintaining your profit margin across your business. Menu engineering as a tool can help ensure you are making a healthy margin on each item that you sell. By categorizing your menu items based on profitability and popularity, you can map out data-driven guidance on which items to promote or retire from your menu. If your restaurant is new to menu engineering, integrations like Plate IQ’s connection with COGS-Well can automate much of the data-heavy process.
Menu engineering strategies rely on a foundation of accurate recipe costing and up-to-date pricing data. Automatically digitizing invoice data through your AP solution ensures your pricing data is relevant and easily accessible.
Find New Insights in Invoice Data
Your invoices contain valuable messages — if you take the time to examine the data. Once you have the chance to consistently review invoice data on the items you are frequently purchasing, you can take advantage of new opportunities to improve your bottom line.
Your purchasing data may show wide-ranging insights, from how vendor pricing varies across locations to the best size of an ingredient to buy in bulk. Having access to this data that is unique to your business can provide you with a competitive edge in the industry, particularly valuable as food costs fluctuate.
A solution like Plate IQ also keeps your data safe over the long-term, allowing you to access historical data, without extra fees for document storage.
Focus on Staff Retention and Growth
Staff shortages remain a lingering issue for many restaurant operators, and the industry-wide labor crunch may be here to stay. The same November 2021 survey from the National Restaurant Association mentioned above also reported that “79% of operators said their total labor costs (as a percent of sales) are higher than they were before the pandemic.”
If your leadership and management team has more available time after automating the AP process, you can invest some of that time in your staff. With automation and efficiency gains with the restaurant backend team, you can streamline your processes and focus on growing staff where it is most needed.
A long-term strategy for hiring and retention requires consistent effort. From training programs to mentorship opportunities to promoting a healthy workplace culture, the restaurant industry requires face-to-face time and a focus on the people that make your company successful.
Examine New Business Development Opportunities
The changes in the restaurant industry over the past few years have created new challenges and new opportunities for companies. The rise of off-premise dining experiences, ghost kitchens, and new kinds of hybrid kitchens means that your restaurant may need to examine new business ventures to stay ahead of the curve.
Whatever growth strategy your team decides to pursue, examining how you scale your operations should be central to the conversation. With AP automation, as you grow, you don’t need to worry about adding more back office roles to handle the increased invoice workload.
AP Automation Can Fuel Success in Your Business
When you automate your time-consuming, repetitive processes, like invoice processing, you can focus on the work that is most important to your restaurant’s success. Overall, when you adopt an efficient, streamlined AP system, you can experience company-wide benefits.
Interested in checking out how Plate IQ can save time and unlock growth across your company? Request your free demo to see how automation can change how you spend your time.
Jillian Straw writes for Plate IQ, covering technology in the hospitality industry from a background in restaurants and operations management.
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