Basware represents model "from purchase before payment" for optimization of cash flows in the organizations

The model "from purchase before payment" is understood as all process, since selection of suppliers and the order of goods or services and up to payment of accounts. At the same time all transactions with suppliers are under constant control, and the company has an opportunity to significantly optimize financial flows. The model "from purchase before payment" is a key component of business processes of the company which allows to manage expenses and income and operates at the same time at the level of several divisions – department of finance, purchases, accounts for payment and treasuries.

Having organized an electronic document management system, finance division will be able to provide transparency of financial flows and control over cash flow. Standardization of internal protocols will allow to coordinate entirely process of purchases with the purposes of the company. As a result the organization begins to work well-coordinated for the sake of achievement of a common goal and economy due to increase in efficiency. The last is accurately traced at each stage in the form of expense reduction and increase in working capital, and, finally, positively influences the net profit of the company.

Thanks to solutions of Basware of the organization can transform the processes worldwide "from purchase before payment". Resources of Basware network allow to process more than 15 million purchase orders and electronic customer accounts of the companies from different industries today.

On the basis of the experience the Basware corporation selected four stages through which usually there go the companies, which purpose to integrate purchases with financial processes and to reach visualization and transparency of processes "from purchase before payment":

• The new company – process automation is one of the first steps which are taken by the companies of this type. Accounts represent a source of authentic data on obligations which are available for the company concerning expenses and cash. Traditional drawing of paper accounts very costly, occupies a lot of time and does not provide transparency of expenses. Conducting paper document flow also limits a possibility of department of accounts payable to respond quickly to the requests of both internal, and external interested persons, including suppliers. Thanks to an exception of paper exchange and automation of processing of accounts, the New company tries to obtain higher level of transparency and control. It allows it to observe obligations to suppliers most precisely.
• The taken place company – the main characteristic of the Taken place company is closer integration and the coordinated work of purchasing departments and finance reached thanks to respect for the international standards of management and technologies of purchases. Finance divisions of such companies can create the procedures of compliance promoting decrease in number of accidental purchases to 40%, and the staff of purchasing departments begins to integrate the base of suppliers into the system of the direct order of goods, providing thereby availability of the complete reporting under process of P2P at any time.
• The network company – characteristic of the Network company is transition to completely integrated model integrating in itself finance, purchases and external suppliers. It allows to select strategically effective suppliers and to manage all lifecycle of contracts. The benefit from application of model "from purchase" begins to increase up to payment many times. It occurs thanks to the open network integrating sellers and buyers of different scale and allows suppliers to receive also additional benefit due to expense reduction on business, bigger transparency of processes and acceleration of payment of accounts. The purchasing department strengthens vendor relations, providing an uninterrupted payment flow that significantly facilitates possibilities of forecasting.
• The dynamic company – at this stage at the company expenses on document handling throughout all cycle "from purchase before payment" are already completely optimized and time of return of investments is reduced. Heads of departments together work on implementation of the innovation strategy of making payments, and the complete transparency of cash flows allows the company to reduce capital value and to optimize distribution of the current assets. The shareholder return and credit rating of the company increase that has an impact both on a gross income, and on net profit. The companies with the high level of cash can implement the innovation strategy of payments also. It will allow them to maximize discounts when purchasing and to guarantee the situation of stability to suppliers, at the same time optimizing indicators of accounts payable periods and delay of the issued orders. The similar transparency and the adjusted processes will allow the Dynamic company to increase financial and organizational maneuverability considerably.

The model based on knowledge of experts of Basware also accumulates the best practices of the leading world companies that allows to provide fast and reliable integration of suppliers into a chain "from purchase before payment". A possibility of participation of suppliers, regardless of their size, the industry or a geographical location, in all P2P processes of the company and also electronic exchange of documents, extremely important element of process "from purchase before payment", but often it remains indifferently. It can lead to deterioration in control over expenses and decrease in return of investments into process development "from purchase before payment".

"The economic situation in the market requires today that cash management in cash became the main objective of finance division and purchasing department. The solution "from purchase before payment" represents the ideal platform based on which they can combine the efforts, - Andrew Bartolini, the executive director on researches of Ardent Partners company commented. – In process of development and improvement of the program "from purchase before payment" advantages which the company gets at primary implementing solution including investments into additional resources and technologies, can significantly accelerate return of investments and provide maximizing advantages of application of model "from purchase before payment".

Steve Madiman, the senior vice president of Basware company, noted: "In 2011 the cash capital still remains essentially important factor for business therefore more and more time is found for studying of cash flow from receipt them in the form of income before transformation into outgoing costs. The insufficient transparency throughout all cycle often leads to distortion of information on the available capital because of loss from a type of a part of means. According to Cost of Control 2010 (the cost statement on management), the transparency is a key factor which allows to estimate efficiency not only finance division, but also the general commercial success of business. This platform is created allowing the companies to estimate, use of process of P2P as directly in their company, and in vendor interaction is how effective. Also it gives them an opportunity to lay own way to improvement of internal processes according to the current provision of the company, its purposes and culture".