Vendors may be in the business of making money, but that doesn't mean they don't have to spend their own. This blog has talked at length about the overhead costs many vendors are struggling to keep down and, according to an article in PYMNTS.com, part of the problem is that customers don't appreciate vendor payments.
When one business buys from another and makes a payment, the procurement specialist isn't thinking about the vendor's expenses. They are already preoccupied with their own finances - whether or not they will see a return on their investment and how this particular purchase will affect their bottom line are just some of the many factors procurers weigh before paying their suppliers.
"Are you familiar with the world of vendor payments?" the article asks. "Odds are you're not, but it remains a crucial part of B2B commerce for many businesses throughout the world."
Vendors must work with their customers to establish a common ground. If processing B2B payments are hurting the company's bottom line because the customer's preferred method of payment is resulting in high processing fees, something must be done to change that fact.
Vendors should encourage the use of a p card that contains level 3 data with line item detail. This will provide their customers with valuable data which can, in turn, be used to evaluate budgets and adjust procurement strategies in the future. It will also reduce processing fees that can reach exceptionally high levels when commercial cards are used.
If customers are given an incentive to pay with their p cards, they will be able to receive the same great payment processing service they come to expect from their preferred vendors while also allowing merchants to reduce their own costs. But first, vendors should consult a payment solutions provider to ensure they are equipped with the tools needed to process such payments.