When Manual Accounts Payable Slows Down Your Service Business

For skilled services companies, delivering quality offerings to your customers is a top priority. But behind the scenes, managing manual and inefficient accounts payable (AP) processes is no small feat. From managing multiple locations and brands to relying on paper invoices and checks, you could be missing out on significant opportunities to save money and improve operational efficiency.

Key takeaways

• Manual AP is costing you more than you think: Paper-based processes lead to higher invoice processing costs, delayed payments, and strained vendor relationships.
• Digital payments and automation drive efficiency: Switching from checks to ACH or virtual cards reduces costs, improves cash flow control, and can generate rebates.
• Integrated AP tools streamline operations: Connecting AP automation to your ERP or accounting system helps eliminate data silos, reduce manual entry, and boost accuracy.
• Scalability and visibility are key: Multi-entity support, real-time dashboards, and audit trails help your business scale operations while staying in control.

The trouble with relying on outdated processes

Home services companies face a unique set of challenges. Whether or not you deal with cyclical demand (think HVAC companies during the summer or winter), managing cash flow effectively is crucial. Home services businesses also deal with managing payments to many vendors of all sizes, complex tax regulations, high equipment costs, and the occasional non-paying customer.

Another challenge is the overall ownership and reporting structure. With widespread industry consolidation, firms are looking for fast and cost effective ways to unify processes — all while working toward centralizing operations into one corporate office or team. Without that centralization, you’re dealing with multiple brands following a slightly different way of doing accounts payable — one that’s likely outdated and heavily reliant on checks. 

Common challenges in Accounts Payable

Before your business can deliver great service in the field, you need to ensure that your back-office operations run just as smoothly. Unfortunately, many service businesses still rely on outdated, manual accounts payable processes that create inefficiencies and add unnecessary costs. From paper-based payments to disconnected systems, these roadblocks can slow down operations, increase risk, and limit visibility into your financial performance. Below are some of the most common AP challenges that hold service businesses back.

• Lacking modern payment optimization
• Paying bills outside your service management tool
• Invoice errors and payment delays
• Loss of control and visibility
• Business continuity risks
• High processing costs

Lacking modern payment optimization 

Home services businesses are typically check heavy, and their AP teams don’t often use ACH to pay vendors. Checks may not be modern, but they feel simple – even as payment trends continue shifting toward digital methods; and check float affords businesses a level of control over when money leaves their accounts, which can support cash flow management.

With that said, MineralTree’s most recent State of AP report found that the majority (62%) of buyers plan to convert more payments to digital over the next year, driven by factors such as: 

• Faster payments (53%)
• Increased processing efficiencies (45%)
• Increased security and fraud protection (39%)
• Cost savings (32%)

Paying bills outside your service management tool

Think about the technology where you spend most of your time. It’s likely a service management tool like ServiceTitan, where you send technicians out into the field, open tickets, and buy supplies. In order to pay the invoices you’ve received from these suppliers or any other bills, you have to sync that data with an ERP like Sage Intacct, NetSuite, or Acumatica. It’s a big miss to not be able to automate these processes. 

Invoice errors and payment delays

Manual invoices are prone to errors — from incorrect dates or totals to inaccurate calculations. Unfortunately, it can take many expensive human hours to fix any errors once discovered.

Loss of control and visibility

When accounts payable operations are spread across multiple locations or rely heavily on manual processes, loss of control and visibility quickly becomes a challenge. On top of errors on invoices, manual processes also create approval bottlenecks that can lead to late payments. With teams at different locations processing and paying bills at their own individual hubs — or waiting until the appropriate person is in the office to sign a check — you miss out on corporate control and visibility into the spend of all of your investments.

Business continuity risks

Maintaining business continuity is also challenging without automation, when vacation time or employee turnover can lead to missed runs and audit gaps. Besides having to pay late fees, this can strain relationships with suppliers and supply chain disruptions — none of which are good for business.

High processing costs

According to Resolve, manual invoice processing costs around $15 per invoice. Let’s say your business deals with about 200 invoices per month — that processing alone could cost you more than $30,000 per year. Compare this to the average cost of $5 per invoice with full invoice-to-pay automation, and you could be saving 80%.

How MineralTree can help

The challenges above don’t have to be the inevitable cost of doing business. With a solution designed for the unique needs of home services businesses, automation can be easy and cost effective to implement. 

Seamless ERP integration

With direct ERP integration into solutions like QuickBooks, Oracle NetSuite and Sage Intacct, data can flow smoothly between MineralTree and your accounting system. With a two-way API connection, your ERP remains the central hub for accounting records, while MineralTree automates invoice intake, approvals and payments — saving you time and reducing manual work. 

As an alternative, MineralTree offers Vendor Payments powered by MineralTree, which is fully embedded within Sage Intacct and works with your existing AP process, including invoice capture, approval, and PO matching workflows. Adding Vendor Payments to your Intacct environment requires no integration, no extra user accounts or logins to manage, and no additional IT support needed.

By embedding payments directly into Sage Intacct, the solution enables: 

• Payments from your existing bank accounts via ACH, virtual card, and check
• Direct debit funding for faster payment settlement and easier reconciliation
• Support for your Intacct AP workflows, including multi-entity environments, approval rules, credits and discounts
• Real-time visibility into payment status within Sage Intacct
• Cash-back rebates on virtual card spend
• The option of seamless invoice-to-pay workflows with Sage Intacct AP Automation and Sage AI 

If you’re using a premise-based or specialized accounting system without an open API integration (Sage 50 for example), MineralTree also offers File Connect for TotalAP for certain ERPs. File Connect seamlessly and securely bridges your Accounts Payable data with our modern, cloud-based automation platform, so you keep your supported ERP but gain modern workflows. Whether you need full invoice-to-pay automation or just supplier payments, you’ll reduce errors, improve efficiency, and earn cash rebates, all supported by managed vendor enrollment and responsive support. 

Automatic invoice capture

MineralTree’s invoice capture technology automatically captures invoice data upon receipt so your team can move away from manual data entry (and the errors that come with it). As your business scales across new locations or territories, MineralTree’s multi-entity capabilities are critical. With real-time visibility into invoice and payment status across all entities, finance teams can make informed decisions quickly. 

This looks like: 

• Tiered approval workflows so users can route invoices to the right approvers using automated escalations and reminders, reducing approval bottlenecks  
• Automated data capture and processing, allowing your team to eliminate the 10+ hours per week spent on manual invoice handling. 
• Real-time dashboards and analytics solve for cash flow forecasting and vendor relationship management

Audit trail reporting

MineralTree can help eliminate the stress of an audit, making sure that you have all the necessary documentation, haven’t made any duplicate vendor payments, and have made all approvals appropriately. This also includes implementing the right internal controls to help decrease fraud.

Take advantage of rebates with virtual cards

Another smart optimization move is shifting to virtual cards. Compared with other payment methods, virtual cards drastically reduce payment costs, improve security, streamline reconciliation, and earn cash-back rebates every time you pay. Most of the biggest suppliers you’ll encounter accept virtual cards; plus, you’ll earn cash-back rebates for using virtual cards. 

Virtual cards can help you pay invoices quickly and efficiently. Many of our customers’ rebates exceed the cost of their TotalAP package, netting them cash to invest back in their business. Skipping this option leaves money on the table and the opportunity to turn AP into a profit center for a business

Besides operational efficiency, MineralTree can help strengthen vendor relationships during crucial peak seasons, making sure that vendors are paid on time. Your expertise is in skilled services — let automation handle your accounts payable so you can focus on delivering to your customers and growing your business.