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In construction, more than any industry, efficient payment processes are vital. After all, it’s the foundation of the relationships with subcontractors, it’s essential to maintaining cash flow, and it’s crucial in avoiding risks.
Accounting software for invoicing is nothing new, and with the recent evolution of artificial intelligence, AI-driven payment solutions have started to surface — offering significant benefits. Of course, many of these solutions look at invoicing from a broad, general perspective that doesn’t recognize the nuances of the construction industry.
This blog will look at why efficient construction invoicing is so essential, the growing role of AI in the industry, and the benefits of construction industry payments automation.
Let’s face it, with how important the payment process is in construction, it’s also rife with inefficiencies and complexities. And it’s extremely time-consuming.
It’s critical that it be done well and, if possible, quickly. After all, we all know some clients pay extremely slowly, and the faster you can invoice them the better your cash flow. Inversely, few contractors like to keep their subcontractors waiting on payment, and you have salaries, materials, and overhead to look after.
Unfortunately, traditional invoicing is by its nature slow — or at least far slower than it has to be. One major reason is manual data entry. It’s not just the time it takes a clerk to input the numbers, but also to collect them, wait on input, verify them (and too often correct errors) — and then, sadly, sometimes make human errors themselves that must be corrected.
These inefficiencies stall projects and increase costs. In fact, studies have shown that poor payment processes not only increase the costs of projects, but frequently cause contractors and subcontractors to have to delay or stop work.
The rise of AI in construction
When it comes to software to support the construction industry, AI is the brass ring. It has tremendous promise in its ability to transform how we work — and how construction businesses will succeed in the years ahead.
That’s why AI has started to take a real foothold in the industry, moving beyond the stuff of sci-fi into a reimagining of everything from pre-design processes to building performance.
In construction finance, AI is a game-changer with the potential to bring efficiencies, accuracy, and cost savings through automation. AI-powered automation takes the burden of mundane, repetitive tasks off human employees and has them conducted by systems that can perform human work.
Why automate invoicing in construction?
Remember, the faster you invoice, the faster you get paid. AI-powered invoicing systems speed the process up, even as they improve accuracy by eliminating human error and being a timelier accounting of costs.
Automated invoicing for construction also reduces administrative work, allowing your accounting teams to be put onto more strategic high-value tasks and can save money by avoiding the need in crunch periods to hire additional clerks.
For example, subcontractor Dynamic Systems Inc. (DSI) was recently able to use automation to handle a huge increase in the volume of business with a relatively small AP staff. When the company saw more than 33 percent revenue than in its most profitable year, it needed to ask itself if it had the capacity to handle the growth.
Their small AP team was already handling about 8,000 invoices a month (and climbing!), and there weren’t even consistent processes and data handling across offices. It adopted Briq, who customized and fine-tuned an AI-based AP automation engine to save time and free up resources. It worked so well that the company then started to use Briq to automate other financial processes like revenue forecasts.
Today DSI sings the praises of how automation frees up employee time, saves money, and empowers employees. Automated invoicing is just one of the many ways AI-based automation pays off in construction.
Want to learn more about how AI and automation can transform your construction business’s processes? Contact us at briq.com/demo.