Managing accounts payable manually is costly and error-prone, with businesses spending $14–$50 per invoice and 55% still relying on manual processes. NetSuite’s AP automation can cut costs by up to 85%, reduce errors, and improve efficiency with tools like OCR and AI-driven bill processing. Key benefits include:
- Faster Processing: Reduce invoice processing time by up to 80%.
- Cost Savings: Lower processing costs to $1–$3 per invoice.
- Improved Financial Control: Gain real-time cash flow insights and better manage payments.
- Scalability: Process more invoices with fewer resources.
NetSuite also supports advanced features like automated 3-way matching, approval workflows, and payment scheduling, making it a complete solution for AP management. Companies like Island Hospitality and The Second City have saved time and money by adopting these tools. Ready to start? Learn how to set up and maximize AP automation in NetSuite below.
NetSuite Accounts Payable Automation & Invoice Management Software
Why Automate AP in NetSuite
NetSuite’s AP automation turns traditional invoice processing into a faster, more efficient process. Using its OCR technology and AI-driven tools, businesses can improve their financial workflows while cutting costs.
Efficiency and Accuracy Gains
NetSuite’s tools can cut processing times by up to 80% and reduce errors, saving companies thousands each year. For example, Island Hospitality cut their invoice processing time from 18 days to just 3 days with NetSuite’s automation. The system uses built-in validation and automated data capture to handle large volumes of invoices with precision.
Financial Control and Visibility
With NetSuite’s automated AP system, businesses gain better control over cash flow. Real-time insights help reduce payment delays, lower processing costs, and take advantage of early payment discounts. The platform’s dashboard offers a clear view of payment statuses, allowing businesses to make smarter financial decisions.
Managing Business Growth
NetSuite’s AP automation helps companies scale effectively, processing nearly four times as many invoices per employee compared to manual methods. A great example is The Second City, which saved $40,000 annually and doubled its processing speed after adopting automation.
"When properly configured, appropriately deployed and well-maintained over time, an investment in AP automation software can pay dividends for many years to come", says Lindsay Pinkos.
Now that the benefits are clear, the next step is learning how to configure NetSuite for AP automation.
Setting Up AP Automation in NetSuite
Setting up AP automation in NetSuite lays the groundwork for integrating AI-powered tools to streamline processes.
Turn On AP Features
To begin, you’ll need to activate the necessary features in NetSuite. Go to the Accounting tab under Enable Features and turn on Accounts Payable. Make sure the Accounting feature is also enabled, as it supports AP functions and links your financial accounts.
Set Up Vendors and Terms
Accurate vendor profiles are key to successful AP automation. Each vendor record should include critical details such as contact information, banking data, and purchase order history. This ensures invoices match correctly and payments are tracked efficiently.
Create Approval Rules
Automating approval workflows simplifies invoice processing. Set up approval rules based on the following:
| Approval Component | Purpose | Key Configuration |
|---|---|---|
| Threshold Limits | Routes approvals | Define dollar limits for triggering approval levels |
| Approver Assignment | Assigns approvers | Link approvers to specific departments or cost centers |
| Validation Steps | Ensures process completion | Outline checkpoints required before payment approval |
NetSuite’s OCR and AI tools handle automated 3-way invoice matching, ensuring consistency across invoices, purchase orders, and receipts.
To stay on top of your AP processes, customize your dashboard with KPIs and alerts for:
- Open purchase orders
- Invoices awaiting approval
- Upcoming payment deadlines
- Scheduled payment statuses
Once these steps are in place, businesses can explore additional AI tools to further refine their AP operations.
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AI Tools for AP Automation
AI is changing the game for accounts payable (AP) in NetSuite by streamlining processes and automating tasks. Once NetSuite’s AP features are set up, adding tools like Mesha can take things further by handling complex tasks and delivering actionable insights.
Smart Invoice Processing
Mesha’s AI brings advanced invoice processing to NetSuite, making AP workflows faster and more efficient. Key features include:
- Three-way matching: Automatically matches invoices, purchase orders, and receipts.
- Smart coding suggestions: Learns from past data to suggest accurate coding.
- Predictive analysis: Improves accuracy by analyzing trends and patterns.
Companies using AI tools like these have slashed invoice processing times from 17.9 days to just 3.4 days – showing how much time automation can save.
Risk Detection and Planning
AI tools also improve financial control by using analytics and forecasting to monitor transactions. Here’s how they help:
| Feature | How It Helps | Benefits |
|---|---|---|
| Anomaly Detection | Flags unusual payments | Reduces fraud and errors |
| Cash Flow Forecasting | Predicts payment schedules | Manages working capital better |
| Vendor Analysis | Tracks supplier payments | Helps optimize payment timing |
Automated Payment Systems
NetSuite simplifies accounts payable (AP) processes by combining payment processing and reconciliation within its ERP system. This creates a secure and efficient way to handle vendor payments.
Payment Scheduling
With NetSuite’s payment scheduling, you can automate payment timing using flexible rules, multi-level approvals, and payment batching. This reduces manual errors and helps manage cash flow effectively. The SuiteBanking Center dashboard gives finance teams a clear view of all scheduled payments, allowing them to make adjustments as needed. This approach not only improves vendor relationships but also helps manage working capital efficiently.
Payment Method Integration
NetSuite collaborates with HSBC Bank USA N.A. to support payment methods like ACH, wire transfers, and virtual credit cards. These options are secure, cost-effective, and work seamlessly across global markets. The system integrates directly with HSBC, making it easy to set up payment methods and automate reconciliation.
"NetSuite Payment Automation provides a simple, fast, and secure way to make payments directly from NetSuite, reducing manual errors and increasing efficiency", according to NetSuite’s documentation.
AI-driven tools further enhance the system by improving payment timing, spotting discrepancies, and simplifying audits. The SuiteBanking Center also includes reporting tools to analyze payment trends and refine payment strategies, offering a complete solution for modern AP management.
Next Steps for AP Automation
Setting up AP automation in NetSuite takes careful planning to ensure it delivers lasting results. Begin by thoroughly reviewing your current AP processes and pinpointing areas that need improvement.
Clean Up Vendor Data
Make sure all vendor information is accurate and up-to-date. Double-check payment terms, contact details, and tax information to avoid errors and stay compliant.
Test with a Pilot Program
Start small by automating a limited number of invoices from trusted vendors. Use this pilot phase to test workflows, spot issues, train your team, and make necessary adjustments before rolling it out on a larger scale.
Track Key Metrics
Keep an eye on important metrics to measure the effectiveness of your AP automation efforts:
| Metric | Target Improvement |
|---|---|
| Invoice Processing Time | Reduce by 60-80% |
| Processing Cost per Invoice | Decrease by 40-60% |
| Early Payment Discount Rate | Capture 80% or more |
| Payment Error Rate | Keep under 1% |
AI tools like Mesha can make tracking these metrics easier. They help improve invoice accuracy, reduce manual tasks, and streamline approvals, all while ensuring compliance with regulations.
"NetSuite’s documentation. "This includes leveraging real-time reporting and analytics to identify bottlenecks and make informed decisions."
Proper training is key to a smooth transition, helping your team adapt and minimize errors. As your company grows, revisit your strategy and take advantage of new NetSuite features. Regularly reviewing approval workflows and vendor partnerships will keep your AP automation running efficiently and aligned with your business goals.
FAQs
Does NetSuite have AP automation?
Yes, NetSuite introduced AP automation in 2022 to streamline accounts payable processes. This feature simplifies the invoice-to-pay workflow, reducing manual work and errors. By automating tasks like invoice capture, approval workflows, payment scheduling, and real-time reporting, businesses can improve efficiency and cut costs.
Studies show that AP automation can reduce processing times by nearly 20%, saving over five days per cycle. Additionally, it lowers processing costs to just $1–$3 per invoice.
"Veckridge transformed their distribution operations by launching NetSuite in just 60 days. Their AP Automation implementation now automatically generates bills upon order receipt, utilizing existing PO data in the system."
NetSuite’s AP automation integrates directly with its other features, so there’s no need for extra platforms or logins. Solutions like SquareWorks’ AP Automation Suite, trusted by over 400 organizations, demonstrate the effectiveness of NetSuite’s tools.
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