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The benefits of erp payment systems

Sunday, December 06, 2015

Understanding how payment integration can improve your business

When it comes to running a business, there’s a lot you have to stay on top of. From accounting to resource management to operations, small business owners like you need to have a finger on the pulse of everything at your company. To help you manage your business, you may have looked at ERP systems in the past. But in this article, we’re going to look at what they are and the top benefits they can offer your business, especially when it comes to ERP payment integrations. To start, let’s learn more about ERPs.

What is Enterprise Resource Planning?

An Enterprise Resource Planning system is an application or software that can help you stay on top of your business. This software system integrates multiple aspects of your business operations into one place. Enterprise Resource Planning software combines all of its inputs from multiple departments, including accounting, manufacturing, inventory management, supply chain management, procurement, sales, marketing and human resources (HR). Integrating all of these business functions can give your business a competitive advantage. ERPs are made up of a suite of integrated applications or modules, with each business function having a separate module. These modules all integrate for a whole host of benefits.The benefits of ERP software include automating business processes, optimizing workflows, forecasting business needs, collecting and storing customer information, providing key insights across the company, and setting internal controls.

Seeing the real-time data across various departments can also help inform company decision-making from key stakeholders. ERP implementation enables these stakeholders to analyze many different scenarios to help improve business operations. They can use all of this real-time information, including business data and metrics, to find process improvements that can help the company’s efficiency.

By becoming more efficient, a company can lower its operational costs to gain cost savings, more productivity and more profitability from a cloud ERP solution. Now, you might be wondering, “How does ERP fit with payment systems?” Let’s take a closer look.

How does ERP fit with integrated payments?

With an integrated payment system that works with ERP software solutions, the payment processing function of a business connects with the rest of the company’s systems. From accounting to payroll to customer relationship management (CRM), an ERP integrated payment system helps you keep all transactions in one place, even across different departments. This also enables you to accept a variety of payments, including credit cards, debit cards, ACH or echecks, right in the software. Now that you know more about ERPs, let’s look at the benefits of ERP payment systems.

What are some of the benefits of an ERP payment system?

There are many benefits of utilizing an ERP payment system. Here are some of the biggest benefits:

Increases your revenue streams

On time payments mean more cash flow, which is a vital part of a growing business.

Customers will be more likely to pay on time when you offer multiple payment methods through your ERP. That’s because customers can pay right on your platform. By making the process to pay invoices frictionless, you’ll get paid faster than if customers have to struggle with bank transfers. This can limit disruptions to your business while also removing bottlenecks that prohibit your cash flow.

Supports multiple credit cards in a single transaction

Some customers may want to pay their invoices with multiple payment cards. And besides being able to pay all in one place, an ERP payment system often has the technology to accept multiple payment cards in a single transaction. That gives your customers even more payment flexibility than they’d have with paper invoices.

Increases transaction security

With an ERP payment system, you’ll see increased security. As you might know, you’ll need to be Payment Card Industry Data Security Standard (PCI DSS) compliant to accept payments online. This regulatory compliance designation means you’re protecting data from fraudsters. The good news? ERP payment providers can help ensure your business is PCI compliant. Because of these strict standards for compliance, you can rest assured that your customers' payment information will be safe.

Another important technology for ERP payment systems is tokenization. Tokenization is the process that takes a credit card number and converts it into a series of numbers and characters. This token is used in place of the credit card number. Therefore, outside of the specific transaction, the token is useless. This helps prevent fraudulent activity because even if a fraudster were to get ahold of the token, it would be meaningless for any other transactions.

Ease of tracking

Because payment records are stored virtually in segmented databases, businesses and customers can see when payments have been completed and track the entire life cycle of the invoice. This centralizes the payment process as a whole for customers in one place.

Minimizes fees and costs

Processing credit card payments can be costly. And if you’re accepting other forms of payments for invoices, those can cost too. But luckily, an integrated payment solution as a part of your ERP can help reduce some of the payment processing costs you may have. An integrated payment system also enables you to eliminate the management of standalone payment systems or keep track of multiple payment portals' logins. An ERP payment system keeps all of that information in a centralized location.

Streamlines payment processing

As consumers, we typically want the easiest way to pay for something. Ease has become king, and the easier the payment system is, the more likely someone is to use it. An ERP payment system helps streamline the whole payment process, as the process is simple and straightforward for customers. A payment gateway that’s embedded into your ERP can offer a seamless payment gateway experience for your customers, making checkout or invoice payments easier than ever before.

Improves customer relationships

There’s nothing like a bad customer experience. By helping to remove the friction between receiving an invoice or purchase order and making a payment, an ERP payment system can help you keep your customers happy. You can even automate payment notifications to help make sure your customers pay on time. They’ll appreciate the gentle reminder as their payment due date approaches.

As you can see, an ERP payment solution has many benefits that can help your business. But, like any other business tool, there are some watch outs. Let’s look at some of these in the next section.

Cautions of ERP payment gateways and portals

While ERP payment gateways and portals offer a host of advantages, small business owners like you should examine the following considerations:

  • Fraud risk: While digital payments are an overwhelmingly secure way to pay, thanks to PCI standards and other regulations, there’s always the risk of fraud. While it’s lower than incidences of fraud with traditional payment methods, cyber fraud is still possible. So when you’re looking for a payment systems partner, you’ll want to evaluate their security protocols to make sure they’re staying on the cutting edge and a step ahead of hackers.
  • Compliance requirements: As you’ve seen, compliance is an important consideration for accepting online payments. Not only have the card networks instituted more stringent rules and regulations but so have other financial institutions. That’s why it’s important to ensure that your payment processor follows all of the compliance obligations on your behalf.
  • Investment in integration: While integrating a payment portal or gateway is a pretty straightforward process, you’ll still need to consult with your ERP provider to see what resources are necessary to integrate payment capabilities. This can be an investment, especially if you’re integrating a new system with an old one, so you’ll need to weigh the investment against the return on this integration, much like you’d do with any investment in your company.
  • High customer expectations: In the ecommerce world, customers are so familiar with buying products online that they expect fast, easy and streamlined transactions when dealing with online payments. Because this is the case in their personal lives, more and more professionals seek the same customer experience in the business world. Therefore, there’s more pressure on business-to-business transactions to be just as seamless.

This article discussed the benefits and disadvantages of ERP solutions, including the benefits of integrating a payment function into your ERP software. ERP software can help you streamline some of the time-consuming operations at your business while providing you with a solution that has all of your business functions in one place. Plus, when you add a payment integration, you’ll expect to gain even more efficiency in your operation. That’s good for you as the business owner and your bottom line.

Ready to work with a payment processor who can help you with payment systems?

Heartland is the point of sale, payments and payroll solution of choice for entrepreneurs that need human-centered technology to sell more, keep customers coming back and spend less time in the back office. Nearly 1,000,000 businesses trust us to guide them through market changes and technology challenges, so they can stay competitive and focus on building remarkable businesses instead of managing the daily grind. Learn more at heartland.us.