Accurate cash flow via automated AP

There are plenty of things we wish were more accurate and predictable. Our ETA during rush hour traffic. Whether or not our favorite trash reality show is getting renewed for another season. But when it comes to cash flow in restaurant operations, accuracy and predictability can make or break your restaurant's finances. 

As a restaurant operator, you already know that running a restaurant is notoriously expensive, with thin profit margins and plenty of moving parts. Staying on top of everything isn’t a one-person show, and without the right tools, it's easy to lose track of important details, needs, and metrics, including your cash flow. 

In fact, 67% of restaurant operators spend more than 100 hours per year just on payroll, and 56% of AP teams spend over 10 hours a week on invoice processing alone. 

Luckily, manual bookkeeping and the days of keeping track of those handwritten spreadsheets are no longer the only option. Advancements in technology and new, automated tools can help take your restaurant's finances from crunchy to smooth. So, what exactly is “automated AP?”

Automated AP is a way of digitizing previously paper-based accounts payable tasks (like coding invoices and paying bills), leading to faster turnaround times, more accuracy and a better birds-eye-view of your restaurant’s finances. Sounds like a win-win!

Before we get into more detail about which automated AP tools can help you improve cash flow accuracy, let’s go over a few of the overall benefits of AP automation.

Three benefits of AP automation

• Increased efficiency - By automating traditionally manual tasks, you can increase both the speed and accuracy of managing your restaurant’s finances and simplify daily tasks. Additionally, many AP automation tools easily integrate with your accounting software and can cut 12 -15 hours per week for AP staff. Approvals and payments can be sent faster, and you can cut back on the time needed for audit preparation. 
• Cost reduction - Manual invoice processing can cost an average of $15-$16 per invoice, with additional fees for cutting paper checks. Automating your invoices can lead to as much as an 80% reduction in processing costs. Pair this with perks like not forgetting to make a payment (and suffering late fees) and increased visibility of your restaurant’s finances, and you’ve got a pairing better than unoaked Chard and Gouda. 
• Improved accuracy - As with any manual tasks, there’s always a risk of human error. Handling invoices after a long day, or trying to process payroll when you’ve got a plateful of other equally important tasks to complete (one-third of accounts admit to making at least a handful of mistakes per week due to capacity constraints), can run the risk of hiccups and costly mistakes. AP automation can help take some of the pressure off by simplifying the process, cutting down on mistakes and freeing you up to focus on running your restaurant.

Now that we’ve gone over a few of the general benefits of automated AP, let’s explore a few specific tools and how they can lead to greater accuracy in your cash flow. 

Now that we’ve gone over a few of the general benefits of automated AP, let’s explore a few specific tools and how they can lead to greater accuracy in your cash flow. 

We’ve asked one of our very own [me]ople (a nickname we use for our MarginEdge staff), Rachel Dick, for her take on MarginEdge automated AP tools. Rachel, a former restaurateur and current Controller in Residence at [me], focuses on all things accounting. 

Let’s take a look at a few tools that can make accurate cash flow an everyday thing in your business, with a little help from Rachel.

Five automated AP tools for cash flow accuracy

1. Automated invoice processing

Ah, every restaurant operator’s dream: spending hours upon hours manually coding invoices - not! If you’re ready to ditch the paperwork, tools like MarginEdge’s automated invoice processing feature can help cut back on time, increase cash flow accuracy and reduce that post-invoice headache. 

With this tool, invoice line-item data is automatically sent to your accounting system, eliminating the need to double-check that your numbers match. Additionally, even handwritten invoices can be digitally stored and coded in less than 48 hours. 

Restaurant operators can even set up a review process that automatically syncs with accounting, see all expenses at once and set approval rules for product categories and vendors. By streamlining and digitizing how you handle invoices, you can make decisions based on real-time data, reduce the risk of human error and better forecast your cash flow needs. Real-time data = better decision making = more accurate cash flow.

Rachel’s take ✨: 

“I love the ease of ensuring that everything is coded correctly. You check it once, and it's done. Every time somebody orders that product, it's the same coding over and over again. There’s no question where it will go, hours of accounting work gone.” 

2. Automated document tracking

Handling your restaurant’s finances comes with a lot of moving pieces (and paperwork). Avoid the Pac-Man-style chase to track down documents, which can eat up your time and money.

With automated document tracking tools, you can digitally store financial documents in one place. Create pre-set tags that will be automatically assigned to incoming files, and grant tiered access to other staff without having to worry about losing paperwork or human error.

Additionally, automated file routing makes it easy to keep track of your financial documents, and integration-friendly technology means you can directly connect to other platforms without the hassle. Keeping track of your financial documents is a huge part of running your restaurant’s finances efficiently. Better tracking means better (and more accurate) cash flow. 

3. Vendor statement reconciliation

With so many moving parts to keep track of when it comes to handling your restaurant's finances, it can be easy to miss the small stuff, and finding the time to dedicate to making sure your vendor statements match your numbers can be a feat all by itself. 

With MarginEdge vendor statement reconciliation, automate the process of making sure your invoices and vendor statements match. Upload your most recent vendor statement, and [me] will automatically compare it to your financial statements to find discrepancies. 

If there are any issues, we’ll handle communicating with your vendors and get you the vendor credits you earned. Using automation tools to ensure your payments line up not only saves you time and money, but also ensures that with accurate numbers, you’ve got accurate cash flow. 

Rachel’s take ✨: 

“I love the time savings of this feature. You don’t have to manage the communication between operators and vendors and spend hours in the zone trying to ensure your numbers are accurate because MarginEdge does it for you. It’s time back in your hands.”

4. Automated payroll

Another time-consuming, financial ball to juggle is payroll. With tools like automated payroll management, reduce the hours you’d typically spend on manual calculations and cut back on the risk of over or underpaying staff. 

You can automatically import hours for multiple positions, automate paid time off and sick leave and calculate both cash and credit tips. Automated payroll systems can also cut back on traditional employee onboarding, taking your process from a few hours to a few minutes. 

When you save time, your operations become more efficient, and the greater your efficiency, the better you’ll handle your cash flow. 

Tip✨: For best results, choose an automated payroll system that integrates with your scheduling system. Fewer by-hand calculations and more time back in your hands means more accurate cash flow for your business.

5. Bill pay

Keeping track of vendor bills can be a hassle. Instead of trying to juggle all by yourself, automated tools like MarginEdge Bill Pay give you a central place to track and pay bills, all while better managing your cash flow. 

Schedule payments, track due dates and manage vendor relationships all in one place, giving you full control over your expenses. This real-time visibility into your bills helps you maintain accurate cash flow projections, so you always know where your finances stand. 

Plus, with automated reminders and easy approval workflows, you can avoid late fees and focus on running your business. MarginEdge simplifies paying your bills, saving you time and improving financial clarity. More clarity = more accurate cash flow.

Rachel’s take ✨: 

“I love how easy the platform makes making payments. The operator selects and reviews the invoices, and [me] takes it from there. There’s nothing else they need to do. I also love the communication piece, because the payments automatically populate and your operators aren't questioning what’s been paid when vendors contact them.”

There are so many benefits to AP automation that we can’t even count them all (get it?). But when it comes to more accurate cash flow, the right automated tools can make keeping an eye on the moving pieces of your business as easy as pie. 

Financial accuracy isn’t just about cost-cutting and time-saving - it’s about the efficiency that can be a byproduct of these things. Automated AP tools can help simplify your restaurant operations. With these tools, you’ll have the grasp you’ll need on your finances to get the cash flow accuracy of your dreams.