Gain Control of Your Vendor Master File
Unclean Vendor Master Files can have a critically negative impact on the entire Purchase-to-Pay data cycle. It affects not only Accounts Payable but also the Purchasing department, with the potential to bring unwanted tension to vendor-client relationships.
Top 5 Ramifications of Unclean Vendor Master Files
Missed Discounts and Contract Incentives
Inaccurate Spend Analysis and Reduced Negotiating Power
1099 Tax Reporting and Compliance Issues
Fraud Opportunities
Duplicate Payments
Cleansing Your Vendor Master File
Technology Insight provides customers with a comprehensive analysis of their Vendor Master File. By following our 5-Step cleanse program, this daunting task becomes quite manageable. A good benchmark for this process is to make sure that 65% of the vendors available in the active system are of active usage in the past 12 months. The 65% benchmark is an excellent indicator that underlying business processes are thoroughly optimized.
In order to complete the cleanse, one must:
Deactivate Vendors Never Used
Deactivate Vendors Not Used Within 48 (Or 36 Or 18) Months
Deactivate Duplicate Vendors
Analyze Remaining Vendors for Missing Data
Match and Verify Taxpayer Identification Numbers
Doing this once is not enough – cleaning your Vendor Master File needs to happen on a regular basis, or you will find yourself right back where you started. Maintenance of your Vendor Master File should be completed monthly.