How Multifamily Companies Can Drive Down Procurement and Payment Costs by Summer
As inflation continues to rise, and real estate companies see higher costs across the board, many purchasing/AP teams are looking for ways to reduce procurement cost.
Some multifamily companies may be doing so by sourcing entirely new suppliers. Others may be looking to eliminate duplicate purchases, leverage more pre-negotiated pricing, consolidate SKUs, and/or tighten up their purchasing procedures.
Nexus can help. Its procure-to-pay platform is equipped for times like these with capabilities to help drive down procurement costs (often by 10%) and payments costs (often by 40%). And the platform can help get it done by summer.
Prevent Spend Creep
At large multifamily companies, with hundreds or thousands of properties, there are many people who can order supplies, from maintenance teams to property managers to procurement employees at headquarters.
While AP/procurement may have negotiated special rates with suppliers, some staff may not know about these lower rates. Others may think it’s easier to stop by the retail store to make their purchase or to just order online.
But those are surefire ways to spend lots of money on non-preferred brands, and on duplicate purchases.
With Nexus’s catalog feature, multifamily companies can centralize and consolidate their spend and limit it to their preferred brands and SKUs. Plus, they can make it easy - and fast - for every employee to leverage their pre-negotiated prices. These factors all work together to reduce cost in procurement.
Nexus can embed the catalogs of 30 national retailers, as well as catalogs from specialty and regional suppliers, into a buyer’s NexusPayables account.
Authorized users just select items from multiple catalogs and place them in one master shopping cart for easy check out. They can generate an electronic PO for approval – and also see if the purchases are within budget (for both the line item and property). If they’re not, they can add an over-budget note to the PO, before it’s approved.
Nexus customers can easily shop online catalogs, create an e-PO, compare to budget and route for approvals – all in one place.
After the purchase is complete, the invoice and purchase order are linked automatically. This saves keystrokes and time because vendors don’t always include PO numbers on their invoices.
As a result of using embedded supplier catalogs and e-POs, Nexus customers report:
- 10-15% savings off retail because of supplier catalogs pulling in pre-negotiated pricing
- 30% savings on office supplies primarily due to reducing duplicate orders
- 100% reduction in over-budget spending
Catalog functionality can be added into existing NexusPayables accounts within weeks. Customers who are new to Nexus may need more time.
Reduce Cost of Payment Processing
Another way multifamily companies can lower their costs quickly is by automating their supplier payments with the NexusPayments solution. Based on Nexus data, companies can lower their payments costs – or the cost of paying suppliers – by an average of 40%.
That’s because they eliminate the hard costs associated with paper checks – like check stock, toner, printers, etc. All their payments are handled by Nexus, who pays suppliers on the customer’s behalf.
All customers have to do is generate a file of approved invoices in their property management system and send it to Nexus. Designated approvers review the transactions in NexusConnect and give Nexus the green light to issue payments immediately. Nexus then pays suppliers via Nexus Virtual Card, Premium ACH, or outsourced check.
Nexus debits customer bank accounts directly to pay suppliers. There’s no interest charged or set-aside accounts. The payments are fully trackable and visible online.
Nexus customers just send a file of approved invoices to Nexus for payment, and Nexus debits customer bank accounts directly to pay suppliers.
Customers who use NexusPayments report hard cost savings such as:
- $5,000 savings on check printing and ACH costs
- $2,000/month savings on toner (and eliminating cost of new printers)
Plus, any eligible spend that is converted to virtual card generates rebates for customers. This is another way to defray some of the costs of doing business in today’s climate. Nexus customers can get set up with electronic payments in a matter of 2-3 weeks, and start earning these rebates quickly.
Reduce Over-Budget Purchasing with Invoice Automation
A third way multifamily companies can reduce their hard costs is by automating their invoice processing, with NexusPayables.
By using Nexus to process invoices, users have full visibility to budgets and actuals (pulled from their General Ledger) before they submit and approve their invoices for payment. They can see line items for each property and category – and identify whether they are over budget during the month.
Armed with this knowledge, they can make better purchasing decisions.
Thanks to Nexus invoice automation, customers report the following hard cost savings:
- 15-20% reduction in expenses due to real-time budget visibility
In many cases, NexusPayables can launch in a month.
Procure-to-Pay Software Makes Life Easier, and Saves Time and Money
Procure-to-pay systems are known for saving employees lots of time because everyday tasks are online and automated. Some also can generate significant cost savings.
Nexus can help multifamily companies do both. Its procure-to-pay solution generates significant time savings on invoice approvals (which is reduced by 40%), payments processing time (which is reduced by 50%) and procurement time (which are reduced by 70%).
And it can help multifamily companies save hard costs – all within a few months.
As inflation stays in the headlines, and labor shortages abound, such functionality is more needed than ever.