Ready to give up the high costs and hassles of paper checks and start paying suppliers via card?
Then heed the advice of Sandy Sakhon, accounts payable manager at WOW!, one of the nation’s leading broadband providers, serving residential, business and wholesale customers in several states.
WOW! uses an electronic payments solution from EML Payments.
Since it started making virtual card payments to suppliers in early 2017, Sakhon’s department has generated approximately $1 million in rebates, greatly reduced the time and cost of paying suppliers, and raised the standing of the accounts payable department in the eyes of senior management.
Are these the types of benefits your organization is after?
Sakhon shares the following advice for maximizing your electronic payments initiatives:
- Develop a holistic strategy: Virtual card payments are not for everyone. For instance, multi-dwelling properties and other suppliers that are paid revenue share or commissions have not converted to virtual cards. That’s why it’s important to choose a solutions provider that offers a full breadth of options, including checks, virtual cards and ACH transactions.
- Communicate, communicate, communicate: Clearly explain to suppliers what’s involved in getting paid via virtual card. Some suppliers don’t read the fine print and were shocked to learn that they were assessed a fee to accept virtual card payments, Sakhon says.
- Don’t overlook utilities: The adoption of virtual card payments among utility suppliers surprised Sakhon. Look for a solution with an online self-service portal to pay utilities via virtual card, as well as the ability for utilities to call the solutions provider for card payment.
- Get everyone on the same page: Mixed messages from field staff and other stakeholders can undermine the adoption of virtual cards, Sakhon warns. She recommends arranging stakeholder meetings before migrating to electronic payments to discuss elements of the program, how stakeholders should respond to common questions, and points of contact.
- Know your suppliers: Providing accurate and complete contact information for each of your suppliers to payments solutions provider like EML Payments enables them enroll suppliers more quickly in virtual card programs. Without contact information, there is no guarantee that your communications will ever reach the right person within a supplier’s organization.
- Never stop enrolling: Suppliers come and go. That’s why it is important to work with a payments solutions provider that will periodically analyze spend files to identify new suppliers who are known to accept virtual card payments, or who can be approached.
- Rethink your standard payment terms: For many suppliers, getting paid faster is a big incentive for accepting virtual card payments. WOW! is adjusting payment terms on an ad hoc basis to encourage suppliers to accept virtual cards (pushing back payment terms for suppliers who demand paper checks). But Sakhon believes that formally adjusting standard payment terms as part of an electronic payments migration is critical for driving adoption.
These seven strategies will help ensure that your organization maximizes its virtual card program.
Click here to read the full case study on how WOW! migrated to virtual card payments.