How One Company Streamlined Payables and Offloaded FX Management

Picture this—a leading B2B software company is changing the game when it comes to their industry. They’re starting a development revolution and bringing a best-in-class product to the masses. Any company with a website, application, or database can benefit from their service—and they’re expanding quickly.

With their headquarters based in the U.S., they wanted to scale growth and operations worldwide. They quickly added suppliers and vendors in more countries, growing both domestically and internationally with 5+ international subsidiaries—all cost centers.

So what’s the problem? The outward success of the business was exponential, but their internal finance team was wasting valuable time onboarding new suppliers and manually managing tax compliance, invoices, and payments. Time-consuming currency management was a consequence of the company’s own success.

Their finance team needed a solution to solve their biggest problem—global payments.

The Payment Pain

When the company began, they had adopted the ERP, NetSuite, but virtually every payment was manual. There wasn’t a system set up. They were paying via banks and ACH and loading critical vendor information directly into their bank account—they were even using a physical checkbook.

When they started to expand globally, they were making payments in various countries by logging in to numerous bank accounts to manually pay vendors—losing track of important invoices along the way. The company’s controller estimated that it was taking their team an entire day to get the invoices sorted and ready for data-entry in order to get paid out.

And they weren’t slowing down. They continued to add entities to the business—adding three different countries in just a year to support sales and customer success. They felt the need to be closer to their customers, and they knew they needed to have a solid process in place in order to pay their team and vendors properly.

AP & FX: The Real Advantage

It was clear that the company’s current FX management process wasn’t working—it wasn’t sustainable for the extent of their growth.

With their headquarters in the U.S., they additionally had individual currency accounts for each of their global entities and subsidiaries in the U.K., Germany, Canada, Australia, and Japan. But, some of these separate offices were cost-plus entities that did not generate revenue—they were unable to support operating costs on their own.

Even in other areas of the business that produced income, there were times when they were not cash flow positive. And, in those cases, the company encountered shortfalls where HQ needed to buy currency at a spot rate. In order to fund these multiple accounts, the company converted USD to the various banks and made payments from each bank. The finance team and controller, located in the U.S., were entrusted with managing those funds and communicating with each bank (on the bank’s preferred time) to wire and convert funds. A painfully time-consuming process in order to limit cash flow issues.

With large companies, there might be treasurers who focus solely on this, finding the best rates and moving funds around—but this company didn’t have the dedicated headcount to deal with these issues.

Their solution? Automating accounts payable with software.

By adopting an automated solution, the company was able to streamline its entire global payables process. Now, they were able to fund in USD to cover all USD and non-USD accounts while the solution converted USD to the other currencies (U.K., Germany, Canada, Australia, and Japan) in their stead. It was transformative—they were able to save time, remove the hassles of converting and funding in multiple currencies, avoid intercompany booking issues, and get better FX rates.

They could now benefit from the rapid growth of their business.

Driving the Business Forward

It’s been two years since the company adopted an accounts payable solution, and they have had a smooth, automated operation ever since—from inputting invoices into NetSuite to making mass weekly payments worldwide, automating payables has completely changed their processes. The company’s controller no longer has to log in to five different bank accounts to approve a payment. And, as they continue to expand globally, this solution is the one system they need to sustain their growth.

AP automation has affected their business so profoundly that they’ve even attributed it to accelerating their monthly close—giving them confidence in the numbers every month and freeing up their time to analyze results. They’re able to focus on the things that matter like working with executives to drive the business forward.

Plus, the accountant on their team is saving a full day of work each week—now, that’s something money can’t buy.

*Disclaimer: This situation was real, but the company name has been removed to preserve their anonymity.