How to Make Payment Terms Your Best Friend Instead of a Deadly Enemy
Payment terms are foundational to an Accounts Payable department, but they’re easy to mismanage. Avoid common pitfalls with this comprehensive guide.
Payment Terms are part of every deal and every Vendor Master File. All A/P departments have a system to manage them – in fact, Payment Terms might seem like simplest step of the Purchase-to-Payment data cycle. Without proper oversight and processes in place, however, they can become a serious issue. Reports contradict each other, historical data is inaccurate, suppliers have different information… The list goes on.
Understanding the risks of poor Payment Term practices is essential for any A/P department. In addition, having a strong system in place to organize your Payment Terms can pay huge dividends by helping you streamline your process and increase your profitability.
This guide will help you:
Identify the problems that arise from mismanaged Payment Terms
Understand the benefits of managing your Payment Terms properly
Create a process to analyze and correct erroneous Payment Terms
Implement an effective system to manage your department’s Payment Terms
Ensure your A/P department is as productive and profitable as possible