A hangover is not the only thing you might be suffering from after the Christmas festivities and as the New Year gets under way many FDs will be tightening their purse strings. Money headaches are a risk you take with the December outgoings but how do you get over spending so much money in one month; Invu's CTO, Stuart Evans explains.
You might not have had the most lavish Christmas party - £25 per head down the local restaurant – but December is a month for many outgoings, not to mention downtime for doing business and lots of employees on holiday. But even if your Financial Director did go 'all out' during the party season, come January purse strings are drawn tight. A key way to ensure you save money in the New Year is to ensure your Purchase Orders (POs) are kept in order from the start. That way you won't need to worry about unexpected (a few too many glasses of wine) or unnecessary purchases which were processed without correct authorisation... finding out too late a colleague ordered a brand new Christmas tree when the old one, in the store cupboard, was quite alright, thank you!
Our recent survey of 200 UK finance professionals found many to be unhappy with the Purchase Order Processing solutions available to them and the daily challenges they face without a simple automated process in place. It revealed that 34% expressed concerns over ease of use and the need to work around the current purchase order process to get things done.
Here's four reasons why ensuring your company has the right financial solutions in place will stop your financial director becoming Scrooge in January.
1. Cut out the manual process – Fragmentation is not good for any business so ensure the process is not changing between departments or that prepared purchase orders are not re-entered in disparate systems whilst employees are suffering from back to work blues, introducing a risk of errors and lack of control.
2. Make communication clear – Your suppliers should know exactly what you need for the year and at what price you expect to pay. Budget holders should be getting the best deal for the best service and product(s) for the business.
3. Reduction in paper – Pieces of paper can get lost or misfiled, while invoice matching becomes time consuming. This also saves money on physical storage too.
4. Use a company-wide template – PO's that are completed using the same process throughout the company ensures all budget holders are collecting the right data when ordering goods and services, that way the Finance Director can spend time on strategic work not on chasing up on unpaid invoices.
An electronic PO system provides the finance department with visibility of company accounts at all times, with the assurance that the information is correct. This not only helps provide peace of mind for the Finance Director when it comes to End of Year accounting or when an audit takes place, but saves them time and effort as they can clearly see any financial commitment on a daily basis.