ERP systems and cross-border B2B payments: Expectation vs. reality

Here’s what 250+ finance professionals running already or soon-to-be global businesses had to say about how well their ERP systems support the mission-critical business of getting paid by international customers.

Will your ERP system handle all your global receivables challenges?

The ERP system is the heart of the business, pumping data through it to integrate and automate processes, and present trusted information to the people who make it run. Finance team members are power users and stewards of the systems, priming and pushing them for ever higher levels of efficiency, accuracy and business insights.

The accounts receivable and payments functionality ERP systems provide is mission-critical. That’s why it was good to see high levels of satisfaction with major ERP vendors across the board – Microsoft, Oracle, SAP, NetSuite, Sage Intacct, Infor and others – when it comes to how they help businesses invoice for, collect and reconcile cross-border payments in our survey of 250+ finance professionals helping to run global and soon-to-to global businesses.*

But one point caught our attention: almost 9 out of 10 (89%) of the respondents said they thought their businesses could save money if more of the cross-border receivables process was integrated with their ERP system. And 88% of respondents said with the possibility of a recession, they need to improve their ability to get paid from their international customers.

If satisfaction is high, what could be going on?

Digging into the data, we found a few insights. Global companies have bigger challenges managing cross-border receivables through their ERP system than those getting ready to – sometimes by a factor of 2x. There seems to be a gap between expectation and reality – with soon-to-be-global companies expecting the system to do things it perhaps needs a boost with. What’s more, survey respondents said that it’s hard to get support from other senior leaders for payments-related software enhancements – which may be leading to a “we’re getting paid, it’s good enough” mentality.

Finance leaders surveyed also think they have ways to decrease DSO if they could better align customer payment choices with their own.

The bottom line is there is room for improvement in how your business gets paid. So what can you do to make global receivables work better within an ERP-centric strategy? Our survey findings yield some insights.

The primary, and maybe most significant, benefit of ERP is a central view of essential financial, operational and business data that can be shared across the organization in near real-time.
Office space with professionals working on their laptops

Finding 1:

Finance relies on their ERP systems as a single source of truth, are champions of integration strategies

The majority of finance professionals surveyed are satisfied with the accounts receivable functionality their ERP systems provide. They’re performing as a central database and a one-stop shop for transactional data. Those satisfaction levels are consistent regardless of the system used or the size of the company – whether it’s Microsoft, SAP, Oracle, NetSuite, Sage Intacct, Infor or others.

In cross-border ecommerce, an ERP system should be a candle that can light up business.

Satisfaction with financial functionality in those systems is high:

93%say their ERP system provides accurate and/or reliable data on the state of global receivables
90%are satisfied with the way their system handles international receivables processes
89%rely on their system as the single source of finance data
86%invoice international customers from their ERP system
Flywire b2b erp finding 1


Tight integration with payment software is crucial

Almost 9 out of 10 (89%) of the respondents said they thought their businesses could save more money if the cross-border receivables process was more tightly integrated with their ERP system.

It’s great to see that integrated strategies are working for finance leaders, and that we’re now at the point across the board where ERP systems are doing their jobs really well. It’s the perfect time to ask – what can we do now and next with these really solid process flows and reliable data.

Ryan Frere

How much does it cost you to get paid?

Finding 2:

Global companies name DSO, localization as challenges in managing global receivables within the ERP system

Can accounts receivable functionality in ERP systems scale to handle all of the complexities involved with collecting B2B payments? Our data sheds some light on that question.

74% of our respondents are operating globally now, with the balance planning to go global in the next few years. Those with more experience on the global stage report far more challenges managing their global receivables through their ERP system than those planning to, or just getting started. The gaps range from payment reconciliation and invoicing in local currencies (where more experienced global companies are almost twice as likely to report problems), to FX, higher DSO, local language invoicing, local payment support, and managing refunds and chargebacks.

One explanation for the disconnect here is that there is sort of a sense that the system will be able to handle it all – almost a false sense of comfort – and cracks begin to show as the company grows.

Flywire b2b erp list

More than half of global companies report problems with various parts of getting paid that only one-third of soon-to-be global companies are anticipating.

They include:

FX and short payments
Negative impacts to DSO
Invoicing in local languages
Offering multiple payment options
Payment reconciliation
Matching processes
Invoicing in local currency
Managing refunds/chargebacks

Another explanation is that senior executives don’t always understand the needs for enhancements to the processing of international payments. 67% of the respondents felt that senior leaders did not understand the need for ERP payment software enhancements. This could affect companies’ efforts to stay ahead of their payments needs as they expand internationally.

Ideally, we would automate the FX rate calculation into our ERP system to calculate the A/R FX impact.

It’s worth noting that sentiment varied slightly by the ERP system in use. For example, users of Microsoft (79%) and Oracle (62%) software are more likely than those who use SAP (49%) to say senior leaders don’t understand the need for payments software enhancements.

We need the ability to deal with fluctuating exchange rates between the time of invoicing and the time of payment.
Flywire b2b erp finding 2


Don’t get complacent with payments efficiencies – taking a “it works fine because we’re getting paid” mentality may be costing time and money.

Consider that CFO optimism about the economy is now below historic averages, sitting at 53 on a scale of 0-100 in the latest CFO survey from Duke and the Federal Reserve banks of Atlanta and Richmond. Revenue growth across the board will likely be muted in 2023 – with CFOs anticipating that input costs and product prices will increase between 4-5%, and their companies’ revenue will grow by just 5% in 2023. Cost pressures and inflation, and labor quality and availability are their top two concerns.

You and your teams are relentless chasers of efficiency. You’re not the type to rest on “we’re getting paid, that’s good enough.”

Are there significant efficiencies to be had in taking a hard look at the intermediary global receivables are moving through – whether it’s a bank, a processor, etc. – and if it’s really embedded in the workflows that already exist? We think so.

Ryan Frere

Can your ERP system handle all your global receivables challenges?

Finding 3:

With more payment methods, automation, finance pros think they could decrease DSO, save money

Finance leaders are also mindful of and wrestling with how to balance a good customer experience with efficiency for the business and their team. Respondents shared that they wished “the process wasn’t so difficult on the consumers’ end,” that they could enhance their “ability to handle multiple languages,” and that they needed “a better process for ACH payments and wire transfers.”

There are differences in what businesses offer and how customers prefer to pay, the survey showed.

Businesses want to be paid by:

  1. Credit card
  2. Debit card
  3. ACH or Wire transfer

Their international customers prefer to pay by:

  1. Wire transfer
  2. Credit card
  3. ACH

What’s more, 87% would like to offer additional payment methods in an effort to decrease DSO. And 98% say there are benefits to handling domestic and international payments on the same platform.

Flywire b2b erp finding 3


Payment experience matters to the customer experience.

Remember that 88% of the respondents said with the possibility of a recession, they need to improve their ability to get paid from their international customers.

The average DSO for international receivables is 97 days, according to our survey. It pays to make it easier for your customers to pay you. Offer multiple payment methods, and enable payment in the customer’s currency of choice. Don’t underestimate the importance of strong global customer support as well.

There’s untapped value in the A/R function when it comes to cross-border payments efficiencies, and that's not only in time and cost savings for the department itself. Finance leaders who grasp the role payments can play in a great customer experience can actually help accelerate their company’s profitability.

Ryan Frere

Think there's a better way to handle your cross-border receivables? Let's talk.

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FAQ from our survey

Do finance professionals rely on their ERP systems as a single source of the truth?
Some 89% of the survey respondents said they rely on their system as the single source of finance data.

What is the biggest problem global companies face when managing cross-border receivables in their ERP system?
Companies can run up inefficiencies trying to manage their international receivables process solely with functionality in their ERP system and their banking partner. Some of the major challenges identified by our survey respondents include issues with FX and short payments, negative impacts to DSO and invoicing in local languages.

How do international customers prefer to pay to make B2B payments?
Customers of the companies surveyed prefer to make cross-border B2B payments through wire transfer, credit cards and ACH, in that order.

How do finance professionals plan to decrease DSO in an economic downturn?
Optimizing costs is important in an economic downturn - and our respondents think strong payment processes can provide efficiencies. Some 87% would like to offer additional payment methods in an effort to decrease DSO. And 98% say there are benefits to handling domestic and international payments on the same platform.

*Flywire commissioned Regina Corso Consulting to conduct a survey of finance professionals to understand how they are using their enterprise resource planning (ERP) systems when it comes to international transactions. This survey is among 250 finance professionals who are at least a manager, work in A/R, A/P, Finance, the Controller’s office or the CFO’s office and work in a company that has at least $50 million in revenue. All respondents also say their company has offices or subsidiaries in other countries or they are going to in a few years.

This survey was conducted online between December 12 and 19, 2022.