PayStream Advisor’s most recent research release, the 2014 Accounts Payable (AP) and Working Capital Report, is one that shouldn’t be missed, especially by business professionals and executives. Why? This report explores the possibilities of something many companies feel they will never see—revenues from early payments. These revenues, gained from early payment discounts, are often unobtainable due to AP departments’ inability to process and approve invoices quickly. However, this report sets out to show that there are alternatives to missed discounts, and that utilizing the right accounts payable practices should be not only an AP, IT, and operations issue, but a strategic priority for treasurers and CFOs.

The report shows that Dynamic Discount Management (DDM) solutions allow annual returns as high as 36% on available cash. DDM gives buyers and suppliers the ability to propose changeable discounts terms through a sliding scale discount (SSD) that decreases the discount with time, creating incentives to pay quickly. While collaborative automation solutions play a large role in paying invoices early, the funds that enable a SSD come from the buyers’ working capital. The report shows many companies don’t feel that they have enough access to this capital, or that the risk involved is too high to be worth the discount, but increased interest from 3rd-party financers has made this a viable and low-risk option.

In the past, suppliers were often the only ones offering discounts, and due to the low response from buyers, these could be fruitless efforts. However, DDM solutions have the ability to pick buyers up off the side-lines of discount capture and turn them into proactive members in the P2P process, offering and setting discount terms themselves, and collaborating with their suppliers to the benefit of both parties. Current DDM adoption is climbing at a 63 percent annual growth rate among companies, and though there is fear of low supplier adoption to DDM solutions, supplier onboarding techniques like free self-service supplier portals are reducing this concern.

The report shows another barrier keeping companies from utilizing their Dynamic Discount capabilities is the doubt of high ROI. However, tools like electronic payments and PayStream’s Perfect Payment Index (PPI) enable buyers to take full advantage of early payments. Electronic payments speed up the process, reduce processing costs, and help prevent fraud. The PPI tool show companies how they can utilize DDM and electronic payments to make the perfect payment—one that is paid on time, uses the cheapest payment method, and achieves the highest possible discount.

PayStream’s 2014 Accounts Payable and Working Capital Report details how companies can utilize tools like the PPI to gain all the possibilities of discount capture. The report also analyzes current market trends and advancements being made in DDM solutions, and included in the report are several detailed profiles of the market’s leading providers of AP automation and DDM solutions. In order to learn how to use their working capital to produce revenues, growth, and success for their companies, PayStream Advisors strongly urges AP and business professionals of all levels to download their free copy of the AP & Working Capital Report today.