Early Payment Discounts
Early payment discounts are a great way for buying organizations to be more profitable while strengthening supplier relationships. Historically less than 1% of suppliers participate in early payment discounts, yet studies show that over 80% of suppliers will consider trading discounts for accelerated cash. And when discounts are taken, over 50% generate more than a 30% annualized return on the cash. In light of today’s cash investment options, these double digit returns are a compelling way to bring substantial new savings to the bottom line.
Getting Serious About Early Payment Discounts
To fully capitalize on discounts, leading organizations formalize an “Early Payment Program (EPP)” that use best practice methods to transform early payment into a high yield mainstream initiative. The Bavelos team has implemented EPP for dozens of leading organizations and brings together all of the expertise necessary for EPP success.
- Valuable supplier insight that helps you target the right suppliers with the best terms
- Best practices to optimize terms policy and align procurement and AP for maximum results
- Specialized vendor outreach that enrolls suppliers into your Early Payment Program (EPP)
- On-going performance tracking and optimization
Get Started NOW With EPP – Because Time is Money
When it comes to launching an EPP, time is truly money. A well executed Early Payment Program can yield hundreds of thousands in savings every month for every billion of annual spend. Bavelos specializes in helping buying organizations quickly and effectively launch an EPP to capture this opportunity. The best way to get started is with a Bavelos EPP Diagnostic that analyzes your payment cycle history using data available in your ERP system.
Bavelos Early Pay Program Analysis
- Measures 10 key indicators of your operational and working capital performance
- Benchmarks your working capital indicators against others
- Profiles your spend density and supplier base
- Analyzes your current payment terms
- Forecasts how much an Early Payment Program will save