Accounts payable (AP) automation can help companies of all sizes streamline their AP processes, save money, and improve efficiency. No matter your industry, there are two main ways to get started with AP automation: buying a point solution or building your own. In the remainder of this post - we will examine the age old question of Buy vs Build through the lens of finance teams within the manufacturing space. Please note while this post is geared for the manufacturing industry - we have seen similar discussions benefit Health Systems as well as Higher Education institutions.
Point solutions are pre-built software applications that are designed to solve a specific problem, such as AP automation for manufacturing companies. Building your own AP automation solution involves developing custom software that is tailored to your specific needs.
There are pros and cons to both approaches.
Pros of buying a point solution:
- Speed: Point solutions are typically faster to implement than custom-built solutions, as they are already developed and ready to use.
- Cost: Point solutions are often less expensive than custom-built solutions, as the development costs are spread across a larger customer base.
- Ease of use: Point solutions are typically designed to be easy to use, even for users with no prior experience with AP automation.
- Features: Point solutions often offer a wide range of features that can meet the needs of most manufacturing businesses.
Cons of buying a point solution:
- Customization: Point solutions may not be as customizable as custom-built solutions, so you may have to compromise on some features or functionality.
- Integration: Point solutions may not integrate as well with your existing ERP system as a custom-built solution.
- Vendor lock-in: Once you have implemented a point solution, it can be difficult and expensive to switch to a different solution.
Pros of building your own AP automation solution:
- Customization: You can customize a custom-built AP automation solution to meet your specific needs and requirements.
- Integration: You can integrate a custom-built AP automation solution with your existing ERP system and other business systems.
- Ownership: You will own a custom-built AP automation solution, so you will have complete control over it.
Cons of building your own AP automation solution:
- Cost: Building a custom-built AP automation solution can be expensive, as it requires the development of custom software.
- Time: Building a custom-built AP automation solution can take a long time to develop and implement.
- Expertise: It requires expertise in software development and AP automation to build a custom-built AP automation solution.
Which approach is right for your manufacturing company?
The best approach for your manufacturing company will depend on your specific needs and requirements. If you are looking for a quick and easy solution, then buying a point solution may be the best option for you. However, if you need a more customized solution or need to integrate with your existing ERP system, then your search for the right point solution may take longer to discover the one for you. Or you and your team may decide no solution on the market can meet your needs because your company is very unique, leading your management team to opt to build your own solution.
Here are some things to consider when choosing between buying a point solution and building your own AP automation solution for your manufacturing company:
- Your budget: How much money are you willing to spend on AP automation?
- Your timeline: How quickly do you need to implement AP automation?
- Your needs and requirements: What specific features and functionality do you need in an AP automation solution for your manufacturing company?
- Your technical expertise: Do you have the in-house expertise to build and maintain a custom-built AP automation solution?
Additional considerations for manufacturing companies:
- Compliance: Manufacturing companies must comply with a variety of regulations, including financial regulations. AP automation can help manufacturing companies to improve compliance by ensuring that invoices are processed and paid on time and accurately.
- Security: Manufacturing companies often have complex and sensitive data, such as customer information and intellectual property. AP automation solutions should include security features to protect this data.
- Scalability: Manufacturing companies need to be able to scale their AP automation solutions as their businesses grow. AP automation solutions should be able to handle increased invoice volume and complexity.
If you are a manufacturing company considering AP automation, it is important to choose a solution that is designed specifically for your needs. If you want to see if Nimbello is that right fit, reach out and request a 1-1 product demo with our team.