Playing now

Playing now

Improve cash flow with automated accounts payable process

Money Matters

Improve cash flow with automated accounts payable process

construction mobility

A consistent cash flow is critical to the financial health of construction companies both big and small. Automating the accounts payable process can help you improve cash flow and ensure that you have the cash on hand to cover essential parts of your business, like payroll, paying subcontractors, and fulfilling purchase orders.

So just how much can automating the accounts payable process actually improve cash flow? Consider the case of Lakeside, California-based A.M. Ortega Construction . A premier underground utility construction, grading, and paving contractor, the company processes approximately 4,000 accounts payable invoices per month.

Using a manual process, it took up to 10 days for expense invoices to reach billing, and as many as 20 days to complete the billing cycle. However, since implementing a paperless automated accounts payable process, expense invoices reach the billing department in 48 hours, and the billing process takes two days. As a result, their monthly cash flow has increased by $4 million a month.

While there are many factors that ultimately determine the health of your cash flow, implementing an automated accounts payable process can go a long way toward keeping your company “in the black” each and every month.

Editor note: This article was originally published in March 2018. 

Ask the author a question or share your advice

When you leave a comment on this article, please note that if approved, it will be publicly available and visible at the bottom of the article on this blog. While your email address will not be publicly available, we will collect, store and use it, along with any other personal data you provide as part of your comment, to respond to your queries offline, provide you with customer support and send you information about our products and services as requested.  For more information on how Sage uses and looks after your personal data and the data protection rights you have, please read our Privacy Policy.