Early Supplier Payment: Problem Solver, Opportunity.

By Nikita Saharia Chaturvedi

Late last month, we spoke with Bob Cohen, Vice President, North America at Basware. He’s excited about a new tool that allows buyers and suppliers to optimize invoice payment terms for better working capital management called Basware Discount.

As a service on the Basware Commerce Network, more than 1 million businesses will be able to benefit from early payment terms, managed online in real time. The service is dynamic in that it offers payment terms on a sliding scale; the earlier the buyer makes payment, the bigger the discount.

Basware Discount is something that customers have been asking for and Basware has been working on for some time, Cohen tells My Purchasing Center in a new podcast interview. “We think that it should have a very beneficial effect for our customers and their suppliers,” he says.

Dynamic discounting, which Cohen describes as synonymous with early payment, enables suppliers to get paid quicker. “Offering early payment to suppliers is both an opportunity and a problem solver,” he says.

As procurement managers know, suppliers often contact their offices asking about the status of their invoices. Smaller suppliers, in particular, may need the cash to run their businesses because they may not have much working capital. Receiving payment early allows them to reinvest in their businesses sooner.

For customers on the Basware Network to pay their suppliers electronically, they first need to onboard their suppliers. Basware has a team that’s able to do this one at a time or en masse, Cohen says, explaining that the company tries to make this as easy as possible. Once onboarded, suppliers can take advantage of different options, including Basware Discount, he says.

As Cohen sees it, use of Basware Discount provides opportunity for procurement. “If buyers can pay suppliers early, suppliers will be happier and the relationship will be stronger.”

Listen to the My Purchasing Center podcast with Bob Cohen, Product News: Basware Discount Helps Improve Relationships

Also see the My Purchasing Center articles, Procurement Takes Lead in Technology Turnaround and Excess Cash? Consider Paying Suppliers Early

– See more at: http://www.mypurchasingcenter.com/technology/technology-blogs/early-supplier-payment-problem-solver-opportunity/#sthash.G2e3dLjA.dpuf