Ultimate Guide to Retail Accounts Payable Automation

Retailers and eCommerce companies can reap significant benefits and competitive advantages by using retail accounts payable automation software to manage payables and pay their supplier invoices. 

Many retail businesses source inventory from both domestic and international suppliers and distributors in their supply chain, facing global cross-border payment complexities, fraudulent invoice risk, errors, and wasted time if payables processes and payments are handled manually. These retailers are looking for ways to gain efficiency, reduce costs, and reduce worker stress to lower employee turnover levels and increase worker engagement. 

This guide defines what retail accounts payable automation is, explains the major benefits of retail AP automation (including providing proof through Tipalti case study applications), and lists several retail ERP systems (and accounting software) with AP automation software integration.  

What is Retail Accounts Payable Automation?

Retail accounts payable automation is AI-driven software for retail and eCommerce businesses to digitally transform from manual to automated invoice processing, guided approvals, mass payments, and payment reconciliation for efficiency, error detection, and fraud risk reduction. Retail AP automation begins with self-service supplier onboarding through a portal. 

Biggest Perks of AP Automation for Retail Businesses 

AP automation software for retail businesses provides companies and their suppliers with multiple benefits. 

7 of the biggest advantages of AP automation software for retail businesses include:

1. Improving supplier relationships and data accuracy with a supplier portal 
2. Better automated invoice processing, including global mass payments
3. Efficiency and faster accounting close from automated payment reconciliation
4. Automated global regulatory compliance for international/cross-border payments
5. Tax compliance preparation reports or optional eFiling
6. Improved visibility and business intelligence
7. Reduced hiring needs

Improving Supplier Relationships and Data Accuracy with a Supplier Portal 

Retail accounts payable automation provides supplier-related benefits through portal-based self-service supplier onboarding for collecting W-9 or W-8 forms before the first payment, giving payees a choice of payment methods in 196 countries and 120 currencies, and providing status communications that will reduce the accounts payable staff workload. 

Self-Service Supplier Onboarding

With Tipalti AP automation software or mass payments software, your retail company can shift the supplier onboarding workload to suppliers through guided automation, saving time for your retail accounts payable staff to perform other work. The payees accurately provide their contact information, W-9 or W-8 form data (with their tax ID to be automatically validated), preferred payment method and currency, and information required to make the payments. 

Supplier Invoice Receipt and Automated Payment Status 

The white-branded Tipalti Supplier Portal, which your company and its suppliers can access, shows supplier/vendor invoice receipt status, and various payment statuses, including approved, in-process for payment, and paid. Tipalti also provides the history of invoices and payments with transaction dates. 

For your suppliers and AP team, this automated status notification means less friction and interruptions to provide or receive the current payment status of an invoice. It also means substantial time savings for your company and better vendor management, supplier relations, and communication. 

Better Automated Invoice Processing, including Global Mass Payments

Invoice processing includes the workflow for receiving invoices and capturing the data in your accounting system, validating suppliers, checking invoices for accuracy, 2-way or 3-way matching with purchase orders (POs) and receivers, getting invoice approvals, setting up batches for invoice payments, making global mass payments, and reconciling payments. 

Your suppliers and vendors submit their invoices to your accounts payable department so your business can process invoices for recording, verifying, completing approval workflows, and payment without using manual processes. 

Tipalti AP automation software provides invoice capture of the header and line item data for payables invoices received through emails, AI-driven OCR scanning, supplier portal upload, or other available methods. Your invoice processing costs are much lower with retail AP automation system from Tipalti, compared to performing manual tasks. 

Tipalti AP automation software uses AI/ML (artificial intelligence/machine learning), RPA (robotic process automation), and other automated processes to complete end-to-end payables processes related to invoice processing, reconciliation, reports, and business intelligence. Tipalti uses over 26,000 algorithmic rules to detect and flag possible payment errors, reducing payment errors by 66%. Tipalti shaves 80% off end-to-end payables processing time. 

Guided approvals with communications, emails, and document views make the approval process faster and easier when you automate accounts payable. Your CFO, Controller, or other authorized financial team manager can approve large batches for mass payments after viewing the cash requirements. With Tipalti automation software, you’ll have an audit trail.  

Efficiency and Faster Accounting Close from Automated Payment Reconciliation

Tipalti’s AP automation and mass payments software prepares automated payment reconciliation for multiple payment methods and currencies included in a batch that may include up to thousands of payments or payouts for efficiency. The automated payment reconciliation can help your business speed up the accounting close by 25%.

Automated Global Regulatory Compliance for International/Cross-border Payments

Tipalti automates global regulatory compliance and screens suppliers against U.S.-government OFAC sanctions lists and other blacklist databases to prevent making illegal payments for which your company could be fined and criminally punished. 

Tax Compliance Preparation Reports or Optional eFiling

Tipalti AP automation software tracks supplier and non-employee independent contractor payments to generate tax compliance preparation reports for IRS forms 1099-MISC, 1099-NEC, and 1042-S. You can optionally choose to buy a SaaS subscription to the Tax1099 software product with Tipalti integration. Tax1099 will automatically eFile your 1099-MISC and 1099-NEC reports with the U.S. government and any applicable U.S. state, using 12 months of Tipalti data for calendar year payments and provide recipients their copy. This added capability saves your retail or eCommerce business from incurring the cost of extra staff time. 

Improved Visibility and Business Intelligence

With Tipalti AP automation tools, the employee stakeholders in your company will have more visibility into payables, cash flow requirements, and business spend.  

Tipalti’s near real-time dashboards provide metrics, including days payable outstanding, and track data trends over time. The Tipalti Pi feature is an AI-driven intelligence engine and digital assistant that can answer your specific questions about payables and spending in your retail company.

Reduced Hiring Needs

The time efficiencies provided by Tipalti AP automation software mean that your retail business can reduce its AP department hiring needs. 

Can Any Type of Retail Business Use AP Automation? 

Any type of retail business can use AP automation to optimize efficiency. Users of retail accounts payable automation include brick-and-mortar businesses, eCommerce businesses, and multichannel or omnichannel retail businesses using physical stores to sell merchandise and also making online sales to customers or using other channels to reach customers. 

Tipalti Case Studies for Retail Accounts Payable Automation

Tipalti AP automation software customers include many types of retail companies, including Touch of Modern and Zola, that have provided testimonials in their Tipalti case studies. Tipalti automation software has earned an impressive 98% customer retention rate and 98% customer satisfaction rate. 

Touch of Modern – Tipalti Case Study for eCommerce (Retail) AP Automation

Touch of Modern is an eCommerce men’s fashion retailer using a website and mobile app to reach its customers. Touch of Modern has been a Tipalti AP automation software customer since 2012. The Tipalti case study is titled “Touch of Modern Saves 4,000 Hours a Year & Streamlines Supplier Payments with Tipalti.” This case study further highlights Touch of Modern’s benefits from using Tipalti:

• Scaled  for growth without adding AP headcount
• Increased efficiency of payments and achieved error reduction
• Increased their payment options and enhanced currency offerings

As a Tipalti champion, Jonathan Wu, COO of Touch of Modern, shared his comments about these software benefits:

With Tipalti, we’ve never had to add headcount in accounts payable or finance.

It becomes crucial that we minimize the onboarding process knowing how volatile things can get with suppliers. An unhappy supplier is more likely to share their experience with others in the community and hurt the reputation of the retailer.

Tipalti is the only system that pulls from a central account to support all the varying payment methods needed. The platform effectively guides our international suppliers through all banking rules and has the intelligence to prevent any global banking remittance issues.

Zola – Tipalti Case Study for eCommerce (Retail) AP Automation 

Zola is a multifaceted eCommerce business that specializes in weddings as a retailer, including providing a bridal registry, wedding websites, and wedding planning. Zola has been a Tipalti customer since 2018. Leaders of the accounts payable and accounting team at Zola provided testimonials and described Tipalti AP automation software benefits for its Tipalti case study. 

Zola’s efficiency gains and scalability from using automation from Tipalti’s AP solution are:

• Automated bill processing and payments for 600,000+ invoices annually
• Accelerated monthly close without hiring additional AP staff
• Future-proofed financial operations for managing millions of invoices and payments on a global scale

The first two quotes are from Shayon Donaldson, Accounts Payable Manager at Zola: 

Our staff doesn’t have to spend all day living in Tipalti. We can better allocate our time supporting the business as opposed to entering and coding invoices.

Our vendors are the heart of our business. The home goods market is a word-of-mouth industry. It’s really important for us to have great relationships with our vendors because that can make or break references to other new vendors that we want to work with. 

According to Flora-Rica Abiva, who leads Zola accounting:

Without Tipalti, we’d have 10 people in AP as opposed to the two people we have right now. And we can still close on the second day of the month.

Why Make the Leap to Retail Accounts Payable Automation?

If your eCommerce/retail business doesn’t make the leap from paper documents and time-consuming manual data entry of invoices to digital automation of accounts payable and global payments, it’s incurring extra costs and giving away the margin it needs to be competitive in retailing. Your suppliers and vendors may be unhappy with receiving late payments that could jeopardize your supplier relationships. And if your invoices aren’t processed quickly enough, you may lose lucrative early payment discounts offered by suppliers as payment terms of 2/10, net 30. 

Making global payments to suppliers is difficult and risky. Retail accounts payable automation and integrated advanced FX software are a stronghold protecting your retail business against attacks by fraudulent suppliers and wasting money with expensive international wire transfer fees, unhedged foreign currency fluctuations, and potential global regulatory compliance fines. 

Can I Integrate My Retail ERP Software with Tipalti? 

Yes. Tipalti AP automation software integrates with any ERP software, including retail ERP solutions, or with accounting software.

Tipalti automation software integrates with the following retail ERP brands and others that serve businesses of various sizes. Many of these ERP or accounting software providers also offer solutions for other industries. 

Retail ERPs for Large Enterprise Companies

High-end ERPs from Oracle and SAP dominate the top tier of ERP systems for the largest companies. Some mid market companies (with sales below the Fortune 500 level) also use these expensive ERP systems. 

Oracle

Oracle provides retail solutions for stores and omnichannel retailers and with its ERP system. Oracle is top-end cloud-based software used by larger companies. Tipalti integrates with Oracle Fusion Cloud ERP and its retail software solutions. 

Oracle owns NetSuite, which provides its ERP retail solution to mid-sized companies and some small businesses. 

SAP 

SAP offers retail solutions, including its SAP ERP software that integrates with Tipalti, SAP S/4 HANA Retail. SAP offers omnichannel cloud retail software solutions. 

SAP also offers lower-end ERP and accounting software products for smaller companies which also have Tipalti integrations. 

Retail ERPs for MIdsized Companies and Small Businesses

Some ERPs with Tipalti AP automation software integration follow. 

NetSuite

NetSuite offers an omnichannel retailing ERP solution Suite (module) called SuiteCommerce. Tipalti works with NetSuite ERP and with NetSuite OneWorld for global multi-entity solutions. 

Infor

Infor offers retail ERP solutions that integrate with Tipalti AP automation software. 

Microsoft Dynamics 365

Microsoft Dynamics 365 Commerce for Retail is an ERP for retailers with Tipalti AP automation software integration. Larger companies also use Microsoft Dynamics 365 retail solutions. 

Brightpearl

Brightpearl is a retail ERP solution with Tipalti integration that’s used by omnichannel retailers and wholesalers. 

Lightspeed

Lightspeed retail ERP integrates with Tipalti’s AP automation (and procurement automation) software. 

QuickBooks Desktop

Tipalti has integration with QuickBooks Desktop accounting software, which provides retail industry solutions with partners for small businesses and some mid-sized companies with a limited number of users. 

The Future of AP Automation in the Retail Industry

The use of AP automation in the retail industry is already high. However, retail adoption will increase at a faster pace because retailers must be competitive. Retailers need ways to increase their margins, cash flow, and working capital and lower their cost levels to achieve business success, stability, and continuity. 

This need for retail accounts payable automation is elevated and requires quick action to resolve in an inflationary and high-interest rate environment that adds costs and reduces profitability. Accounts payable automation lowers costs, provides time-saving benefits of 80% more efficiency, with a reduced need for hiring, strengthens financial controls, and reduces payment errors by 66%, lowering the risk of supplier overpayment that harms cash flow. 

Tipalti has made a commitment to its customers to continually add new features and benefits from product innovation to its finance automation software and support its customers. With Tipalti AP automation, your retail company will have scalability for growth and be at the forefront of AP automation technology. 

Retail Accounts Payable Automation FAQs 

A few frequently asked questions (FAQs) and answers about retail accounts payable automation for your AP processes follow.

Conclusion

AP automation platforms help retail businesses (including eCommerce) and companies in other industries:

• Achieve significant time and cost savings 
• Reduce hiring needs 
• Lower fraud risk 
• Detect potential payment errors 
• Easily achieve global regulatory and tax compliance

Advanced FX features, offered as Tipalti automation products, help companies make cross-border payments in different currencies and countries with cost-effective currency exchange rates and the ability to hedge payables transactions to limit foreign currency fluctuations risk. Explore Tipalti’s retail AP automation solution to learn about how your business can benefit from eCommerce and retail accounts payable automation.