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Definitely Doug 10/18/19
Posted: 12/06/2019

Sustainable Innovation
 
Sustainability can yield multiple benefits to hotels. Saving energy and water yields direct cost savings. Revenue can be generated by guests who prefer to deal with businesses that minimize their environmental impact. And many would argue that conserving scarce resources is simply the right thing to do.

Definitely Doug 12/6/19
Posted: 12/06/2019

Meetings Innovation
 
The sale and delivery of groups and meetings is perhaps the most significant and under-automated functions for many hotels. Even though groups often account for 30% to 60% of revenue, most group bookings are still handled manually for most if not all of steps, as they move from a meeting planner’s research to a confirmed booking.

The biggest enemy to any system is complexity. In a system of inputs and outputs, such as an enterprise system, more complexity means more parts are used in interaction with inputs to create the outputs. Every part that must be built and maintained costs time and money

Tracking the evolution of key performance indicators (KPIs) over time allows hoteliers to identify meaningful trends, create forecasts and budgets and assess the results of different strategies. To perform this kind of analysis, data has to be recorded within consistent time intervals and in chronological order. This is known as a time series.

Definitely Doug 11/15/19
Posted: 11/15/2019

Every time I turn around these days, I see a new vendor or product promising something called a complete Guest Experience Management, Guest Journey Management, or Guest Engagement (or some variation on those words). This week I looked at some of the emerging products claiming to be in this space, both to try to better understand it, and to see what promising ideas it may hold.



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Could You Benefit From Vendor Payment Process Outsourcing?

11/05/2019
by Joe DeMontigny
In today’s fast-paced business world, there are still many employing tools of the past.  Are you one of them?  Let’s look at one service available today that should help you save some money and take steps to solve a growing industry problem; recruiting, training and retaining competent team members, especially in the accounting field.  Much has been written about the changes that have impacted the hospitality industry in the wake to moves to centralized accounting.  The Big Box hotel employing an accounting staff of 10 to 12 is a thing of the past.  As a result, these properties are no longer a training ground for producing skilled hospitality accountants. Unless you are in a metropolitan area that is home to several centralized accounting shops, you’re going to be challenged to find good talent with solid industry knowledge. These are the team members you need to get the job done and provide valuable financial information to measure your properties’ performance. 

To face this challenge, it is important to evaluate the processes, procedures and tasks performed by your accounting team. Are there opportunities to improve their efficiency by outsourcing non-valued added tasks?  One such task is vendor payment processing.  In a 2014 Wall Street Journal article by Vipal Monga, it was reported that half of businesses in the U.S. still pay their bills by check. This percentage is shrinking. In a 2017 survey conducted by the Credit Research Foundation and NACHA, it was found that B2B payments by check were expected to fall from 50 percent in 2017 to 34 percent by 2020.  These changes signal a shift from traditional in-house vendor payment processing to an outsourced solution.  As a result, outsourced vendor payment processing is a fast-growing business services segment that saves time and money.  So, who provides those services?

Your commercial bank is one source for this service. Two such banks include Wells Fargo and 5th/3rd.  Either through an in-house service center or in partnership with an outside third-party, these banks offer multiple vendor payment options.  These options include check, ACH and wire transfers payments.  Payments are initiated by transmitting a file generated from your accounting system to an FTP site maintained by the bank. The bank then processes the file and sends payments.  When payments are sent electronically the vendor receives an email from the bank to notify of the payment and provide details necessary for its proper application.      

Vendor payment services solutions are also offered by many non-bank providers.  These include companies like Paymerang, NextProcess, Tipalti and Corporate Spending Innovations.  Initiated in the same manner if using your bank, these service providers will all make vendor payments by check or ACH.  But many also use a credit card-like payment method using a single-use credit card or a ghost card.  In these cases, the payment service provider will contact your vendor and encourage them to accept payment by credit card. If the vendor agrees, they also agree to pay a processing fee that is often shared with you and reduces your payment processing cost.  

According to Nasser Chandra, CEO of Paymerang, LLC there has never been a better time to outsource vendor payment processing.  He notes that check and ACH fraud is growing fast, with phishing scams becoming more sophisticated. Meanwhile, the efficiencies created are significant, allowing properties to focus on their guests and corporate mission.  Studies by his company have found that the average payment by paper check costs between $7 and $10 considering check stock, envelopes, postage, printer ink and labor. Outsourced vendor payment processing can reduce those costs to between $1 and $3. At a time when managers are seeking to reduce costs and make better use of available talent, outsourcing vendor payment processing is a direction in which everyone should be moving.
About The Author
Joe DeMontigny
CFO
Task Force


Joe DeMontigny is the Task Force CFO. He can be reached at jdemontigny@taskforcecfo.com.

 
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