Digitising your business
Preventing risk to business operation is at the top of every company’s agenda. Whether it is the threat to business continuity, or more perilous hazards such as litigation, potential risk must be avoided wherever possible.
Online portals are a great solution to ensure risk to business is minimised. Not only do they ensure subcontractors can upload applications in a timely fashion, they allow contractors to have fill visibility of all the payments their finance teams must manage. So, how exactly can these systems ensure safe business practice?
What are the risks?
Generally speaking, there are many potential risks which can disrupt business continuity, including legal action, fines and ill-repute. But in terms of the construction industry, lessening the change of risk is fundamental; there are enough pressures on the industry without the need for other variables to cause risk.
Moreover, to ensure the industry delivers projects on time, it is important to reduce risk to business to maintain relationships between contractors and subcontractors.
Negative relations between the contractor and subcontractor can have an impact on an entire project, potentially jeopardising productivity, quality and completion times.
How can risks be combatted?
To minismise risk, a potential solution is to digitise applications for payment, receipt of invoices and other subcontractor processes, so that the contractors pay their subcontractors in a timely fashion, whilst maintaining a healthy, risk-free environment for themselves.
Designed for medium to large contractors, WebContractor from Open ECX is a useful organisational tool, which manages the subcontractor applications for payment process, as well as other subcontractor concerns: insurances and bonds, self-billing invoices, authenticated VAT receipts, minor works and work order instructions for example, offering a great solution for the industry as a whole.
“Digitised systems for the management of subcontractor applications for payment are the solution to stop late payments from occurring”
The tool offers a straightforward, steamlined process for contractors and subcontractors to follow; ensuring everybody involved in a project stays on the same page and for providing a secure yet accessible centralised place for storage of application and payment related documents.
How do online portals work.
Subcontractors can access an online portal for easy and timely submission of payment applications, while contractors take advantage of the workflow and reminder features designed to streamline the management of approvals.
Subcontractors gain full visibility of the progress of their various applications for payment – something that will help them with their business planning and cash-flow. Applications for payment are securely stored for subcontractors and contractors to access payment applications at any given time.
For contractors, this is a great support mechanism designed to enhance visibility, control and compliance of the subcontractor application process, lightening the associated administrative workload.
Contractors benefit from the increased efficiencies, improved clarity around cash-flow, and a far more accurate understanding of their liabilities at any given time. Potential risks, such as litigation, can be potentially avoided, as a thorough, reliable system such as WebContractor has been employed to keep companies organised in terms of notice dates, subcontractor insurances and payments due.
Digital systems prevent late payments
Digitised systems for the management of subcontractor applications for payment are the solution to stop late payments from occuring. Although there are government measures, including the Construction Act and Duty to Report Payment Practices, which are designed to encourage firms to implement measures to reduce the risk of late payments, services such as WebContractor are tangible, accessible method to ensure contractors keep on top of the multiple payments they have to process each month.
Given subcontractors can send payment applications directly to the finance team via the portal, without the need for manual, often paper-based submissions, it improves accuracy, hastens the process and eliminates time costs, as well as lost paperwork.
Time is always of the essence especially in terms of managing cash-flow, meaning digital platforms are a sensible and necessary solution to combating late payments.
With the right technology, processes associated with applications for payment and other subcontractor concerns can become efficient, standardised, transparent and quick.
Most importantly, the automation of these processes can allow for tracking and management across the whole supply chain, which reduces risk and helps build a clear and transparent picture of a business’s finances.
Overall, using online methods for managing applications for payment across the industry’s credibility, plus the health of all businesses operating within the sector.