Using Automation to Find Cost Savings Around the Holidays
The holiday season can be hectic for many companies, even amidst a pandemic. In addition to trying to close out projects before the end of the calendar year, scheduling challenges can be prevalent with many employees taking time off. Yet it’s important to finish off the year strong and not let momentary lapses ruin end-of-year budgets or start you off on the wrong foot in the new year.
Using automation can help you stay on track and even find additional cost savings. By establishing certain processes around procurement ahead of time, and by using technology like an e-procurement platform to enforce protocols in advance, you can help your company have a successful holiday season. Specifically, companies should consider the following areas:
As the year comes to an end, you don’t want to incur too many unexpected costs. One way to stay on budget is to automate purchasing where possible. For example, if you have recurring charges for office supplies, you could use an e-procurement tool to set those purchases up ahead of time. That way, if staff who normally make those purchases are out around the holidays, you can reduce the risk of other employees procuring more costly items if they’re unfamiliar with normal purchasing protocols.
If you have an ongoing service provider relationship, such as with third-party IT or marketing professionals, you also might want to set up an automated, recurring payment plan, rather than incurring one-off charges. If you set up automated payments for, say, 10 hours per week of IT support, you might not have to overpay for extra coverage when your staff takes off around the holidays. Plus, you may be able to obtain better rates by setting up regular payments rather than ad-hoc ones.
Automated Budget Controls
In addition to automating payments, you can also automate how you manage your budget. For example, you could set up automated approval workflows through an e-procurement or spend management platform.
That way, purchase requests automatically get routed to the appropriate person, rather than charges unexpectedly going through. Even if a staff member is out for the holidays, you can still have a secondary approval set up ahead of time. As a result, you can stay on budget and find cost savings opportunities, such as by nixing duplicate purchases or overly expensive ones before they go through.
Automated budget controls through these types of systems can also be set up to find cost savings, such as by providing alerts when you’re close to going over budget. As such, you can try to hold off on end-of-the-year purchases until the new year, when you can build those costs into your new budget.
Related to automated budget controls is automated reporting. For example, being able to automatically capture spend data and create spend reports can help you see how you’re tracking against your budget. If you find that, say, your spend for December is on pace to be higher than in past months, you may realize you need to tighten controls for the end of the year. Perhaps with the holidays approaching employees have been a little bit more lax, but you don’t want that to carry over into unnecessary spending.
Automated reporting can also help you identify cost-saving opportunities by freeing up time for procurement and finance staff. Instead of spending as much time on manually filling out spreadsheets and adding up transactions, staff can focus on areas like sourcing lower-cost suppliers.
As the year comes to an end, staff may also want to spend some time connecting with vendors to thank them for their work together and look ahead to next year. Doing so can help build relationships and ultimately lead to cost savings, such as by working with suppliers to increase order sizes to obtain better bulk pricing rates.
Starting the New Year Right
While you may only be able to implement a few small changes as the year comes to a close, the more you can do now to automate procurement and finance areas, the better position you may be able to put yourself in as the new year begins. With automation in place, you can reduce unnecessary spend, find lower-cost options and free up time for staff to obtain better deals.
Want to learn more about how you can use e-procurement/spend management technology to automate more areas of procurement and unlock cost savings? Request a free consultation with our product experts today.