Commercial card strategies to streamline your Procure to Pay process

Companies often randomize purchasing of equipment, supplies and software. But once the business really starts growing, it’s crucial to have formal Procure to Pay processes in place. You don’t want to stifle growth, but you need to have controls and governance over spending to effectively maintain working capital.

Expanding your workforce, products and markets often makes procurement more complex. To help avoid bottlenecks and ensure compliance, many innovation economy companies are relying on a robust commercial card program to reduce friction, costs and risk.

Solving top challenges in Procure to Pay processes (P2P)

In many companies, problems arise because teams get siloed. When groups function autonomously, they may lose sight of how their actions impact other teams or the company at large. A prime example is how people handling procurement are disconnected from the finance team that’s juggling accounts payable and spend management.

Yet fragmented procurement can drive up costs, risks and compliance hassles – and that affects your bottom-line growth.

Let’s look at common challenges in the p2p process, and how you can tackle them with the right commercial card capabilities:

• Offset the rising cost of goods. With mounting pressure from high inflation and new tariffs, 46% of procurement leaders cite cost-savings as a top priority. Focus on automating card issuance, approvals and expense reporting. It enables more cost-efficient Procure to Pay processes to reduce the impact of pricing that’s out of your control.

• Avoid delays and missed opportunities. Amid rapidly evolving needs and supply chain disruptions, staff may need to move fast on purchasing manufacturing components, lab supplies and so on. Progress can stall if there’s a long wait for cards, approvals or check issuance to pay vendors. Using a single corporate card with customized instant-issue virtual cards quickly enables employees on the fly, and automates reporting and reconciliation.

• Simplify with centralized governance. Employees may be purchasing with various company cards and personal cards. That means the finance team lacks the visibility and control to ensure compliant spend and limit budgets. It puts cash flow at risk and makes monthly close harder. Consider centralizing spend through one card program with an integrated spend management platform. It ensures finance can maintain oversight and auto-enforce policies, while enabling decentralized teams to stay on top of procurement needs.

• Reduce fraud risk. E-commerce payment fraud is now the culprit of 42% of fraud losses. That underscores the need for a hyper-secure p2p process. To safeguard your business, virtual cards use randomly generated numbers for one-time or multi-use purchasing. If a number is compromised, it doesn’t affect the actual card account or your ability to spend.

Procure to Pay process optimization – Real world success

Many SVB clients are increasing efficiency and better managing cash flow by securely automating Procure to Pay processes. One success story is Wildtype, an innovator in cellular agriculture technology, that needs to purchase a constant stream of lab supplies. In early stages, everyone had access to order goods, but that required many manual approvals and expense reports that took staff away from more strategic work.

With SVB’s commercial card and integrated spend management platform, Wildtype streamlined procurement with policy-controlled virtual cards for project leads. Cards are customized with pre-set budgets and pre-coded with specific categories. It helps ensure purchases accurately post to R&D vs. production expense accounts in their ledger. Employees save time by submitting expenses via mobile app instead of manual reports, and finance no longer has to manually code and reconcile hundreds of transactions every month.

Another big win for Wildtype’s procurement is avoiding fraud risk and the related hassles. Previously, when the company had a credit card affected by fraud, they had to get re-carded and update account information across many vendors. Now they use secure virtual cards for specific vendors or purposes. Finance can track spend in real time, and if anything looks suspect, they can cancel the virtual card and immediately issue a new one without disrupting their p2p process.

Streamlining with Procure to Pay automation is a vital way to sustain an agile, cost-efficient business. Learn how SVB commercial cards equip you with powerful capabilities to drive growth.