Profitable Payments: Automating AP for Financial Control

Invoice processing can be one of the most painful AP tasks for many restaurants, as we’ll explore in a future installment of this series. And when workflows like vendor payments and spend management are inefficient, they don’t just create stress — they chip away at margins. AP automation helps hospitality operators improve visibility, optimize spend, and strengthen profitability from the back office out.

Combining corporate debit cards, invoice processing, and expense management 

Loyal customers across Washington, Oregon, and Northern California rely on drive-through coffee stands for their daily caffeine fix. But as they traveled throughout the rest of the country, friends Darren Spicer and John Anderson never saw this type of business. So, they decided to start somewhere as far from the Oregon town where they grew up as possible: North Carolina.

The initial Clutch Coffee Bar storefront opened for business in 2018. In the seven years since the company has added 20 more stands across North and South Carolina. Once the business hit 13 locations, CFO Jake Vandermeer saw that invoice processing was becoming a problem. His initial solution was to build a homegrown application that extracted data from emailed invoices and stored it in a database. Then he came across Ottimate and, seeing what true AP automation could do, replaced that system. 

“We don’t do any paper,” Vandermeer said. “All of our invoices get emailed to us. I set up routing rules that automatically forward the emails to Ottimate, which transcribes the invoices and adds GL codes to each line item. If it’s a new line item, we in finance just quickly map it first. The digital invoices get sent to Clutch Coffee’s managers, who review the coding, make any necessary adjustments, and approve the invoices for export into NetSuite.”

After successfully deploying invoice processing, Vandermeer began exploring other use cases for Ottimate and soon decided to expand it to vendor payments. This is an essential function for every restaurant and hospitality organization, but it’s often haphazard. Late payments can incur fees and damage relationships with suppliers; a manual process is also time-consuming for staff. 

They also introduce avoidable costs — from late fees to missed discounts — that erode operating margins over time. By automating vendor payments, Clutch Coffee enhances its cash flow management and maintains profitability. Companies like Clutch Coffee also have expenses outside of vendor payments that are hard to pay in a way that’s controllable and trackable. 

Clutch Coffee’s team initially used small business credit cards through Concur, their expense management system. However, Vandermeer and other users had to manually enter their card details into the system, and they couldn’t qualify for full corporate credit card programs. 

“It’s hard to get corporate credit when you’re small,” Vandermeer said. “We wanted something in place now that could scale, and traditional corporate cards aren’t going to underwrite that. I was going through the process of finding corporate cards while we were onboarding with Ottimate for invoicing. When we learned that the same system had expense management, card issuing, and invoices, that was very attractive.”

Controlling corporate spending and replacing petty cash

The Ottimate Card enables Clutch Coffee to combine the best of expense management and corporate cards in one. The company can now issue virtual and physical cards to authorized employees, allowing for control over spending on each one. Unlike the cards through big banks, there are no minimum balance or credit check requirements, so users can get up and running right away. 

“Most corporate cards out there didn’t work for us because of stringent cash balance requirements,” Vandermeer said. “Ottimate’s corporate debit cards are way simpler. I can issue one with a single click, control the card’s rules myself, and monitor all of my purchase activity in real-time.”

One of the most significant advantages that the Ottimate Card provides to Clutch Coffee is the ability to compensate vendors in a faster and more organized way. It also enables staff members to pay expenses and bills and quickly delivers $5,000 in cash back. That cashback is real money returned to the bottom line — a tangible example of how smart AP infrastructure contributes to profitability while simplifying day-to-day spend.

“The benefit of virtual cards is being able to pre-assign cards and give them to vendors,” Vandermeer said. “Then you don’t ever have to think about it anymore. Aside from payroll, rent, and some utilities, we use the Ottimate Card for almost every cash outflow our company has.” 

Clutch Coffee’s accounting staff has created a card for each spending category at every store, mapped the cards to their NetSuite chart of accounts, and provided vendors with the card numbers to keep on file. This makes spend management reporting a breeze. 

“All of our virtual cards are pre-assigned to a GL account so that when transactions come through on them, they’re immediately classified to a particular expense account and exported to NetSuite,” Vandermeer said. 

A further benefit of the Ottimate Card is that it helps prevent unauthorized spending, mistaken vendor charges, and fraud. 

“Across all of our virtual cards, locations, and users, we see exactly what all the monthly limits are and exactly what the usage is,” Vandermeer said. “That way, if there’s ever a problem or the vendors are doing something incorrectly, it’s very easy for us to pinpoint. We can see exactly where it is and exactly what the transactions are.”

The Ottimate Card doesn’t just simplify daily operations and ongoing spend management but also expedites Clutch Coffee’s end-of-month closing. 

“If we didn’t have the Ottimate Card, those charges would have to be put onto someone’s actual credit card,” Vandermeer said. “At the end of the month, they would have to go through and classify those transactions, and potentially upload receipts. It’s just a huge pain. So, there’s value in locking in straight-through processing, where the vendor charges the card, and it’s immediately deposited into Ottimate. That card is already classified, and it gets exported to our ERP and journaled to that expense category. That’s huge.”

Like many restaurants, Clutch Coffee used to rely on petty cash for incidental spending, such as supplies or store repairs. The Ottimate Card offers the same on-the-spot flexibility plus the added peace of mind of a secure card. 

“The biggest use case is incidentals, like if they run out of ice and have to run to the grocery store or something,” Vandermeer said. “Around a new store opening, the charges get a lot more diverse because people are rushing around buying small wares or small equipment or tools. Meanwhile, a Regional Manager or Director of Ops will use the Card for gas because they’re driving around multiple hours per day to visit different locations.”

Implementing flexible payment processing

Sometimes, a restaurant would benefit from virtual cards but also from having more flexible payment options for vendors. Tatsu-Ya began with one upscale ramen location and has since expanded to include multiple other Japanese cuisine-themed concepts. The company’s payment process used to involve two employees sitting down together and reading vendors and amounts aloud so that one could enter the information into Restaurant365 and the other into the company’s bank account. Ottimate VendorPay has streamlined this process. 

“It’s been a lot easier,” said Sarah Young, AP and inventory specialist at Tatsu-Ya. “We don’t have to coordinate our schedules so much. I can handle most of the payments, she can handle others, and then we just meet for five minutes to complete the rest. It’s been nice.”

One particular type of payment that used to be challenging for Tatsu-Ya to process is ACH. This has changed with VendorPay, which makes it simple to automatically schedule and approve one-off and recurring payments using checks, ACH, virtual cards, and more, depending on a vendor’s preference. 

“Before, we did about half checks and half ACH,” Young said. “But when we generated ACH payments, we would have to go into our bank portal to generate them. Additionally, our bank required us to call them and read all the ACHs we were sending as a verification step. Ottimate helped us eliminate a lot of headaches on the ACH side of things.”

Several of Tatsu-Ya’s vendors are among the 180,000 companies in the Ottimate VendorPay Network. This allowed the company to simplify its processes further and earn cashback for certain existing payments. The AP automation that Ottimate facilitated has enabled the company to target better how its employees spend not only the company’s money but also their time. 

“We were able to split up our segregation of duties a little bit better,” said Gary Rook, VP of finance and human resources. “Now we don’t all handle the same side of Ottimate. Some people do the invoices, some people do the payments, and then one person does the reconciliations.”

Saving on supplier costs and improving purchasing decisions

In 2005, husband and wife David and Leslie Silverglide were heading home from a trip to Tahoe and discussing local dining options. They realized that there were no healthy fast-casual restaurants in California and decided to address this issue. Since opening the first MIXT location, they’ve added 16 more in Northern and Southern California, as well as one in Dallas. 

As the Silverglides extended MIXT, the amount of paperwork needed to operate the entire MIXT brand increased significantly. They had two employees manually processing invoices and entering payment information into their Restaurant365 system on a full-time basis. When they deployed Ottimate, the first benefit was to automate invoice processing. This led to $100,000 in staffing cost savings. 

But perhaps more importantly, the real-time cost insights Ottimate provides help MIXT make smarter menu and purchasing decisions, preserving margins in a high-cost environment.

Soon after the initial implementation, MIXT’s AP team discovered that Ottimate also offered the ability to get much more granular with purchasing information. Sophisticated reporting features enable them to zero in on detailed menu analytics and the cost of each ingredient at every location, allowing them to keep track of their spending. With the thin margins in the restaurant industry, even small savings can make a big difference.   

As costs change, MIXT can make real-time decisions that weren’t possible before because they have much more detailed and up-to-date information. They can adjust menu prices as needed and switch up the fresh, organic ingredients that comprise most of their cuisine. Ottimate also provides comparative pricing insights for all local vendors, enabling MIXT to get the best deals from existing and new vendors. This improved spend management has enabled the company to save an additional $100,000.

“With Ottimate, we’ve been able to automate almost the entire AP process and get incredibly granular data that informs and improves all of our purchasing, costing, and accounts payable decisions,” said David Silverglide, MIXT CEO and founder.

Want to learn more about how Ottimate can improve your spend management and vendor payments and automate other AP functions? Book a personalized demo now.