Your suppliers that have any eligible invoices receive an Auction Notice from BidPay® on Tuesday. The Auction Notice will contain a list of your approved payments that are eligible for immediate discounted payment. Your supplier has 24 hours to simply click on the invoices it would like to collect that Friday.
Suppliers submitting acceptable discount bids will be notified at the end of the auction on Wednesday. You will receive a file from BidPay® reflecting the necessary adjustment, and you will pay those suppliers’ invoices that Friday, minus the agreed discount. Suppliers that do not bid, or whose discount bids are not acceptable, are paid when their invoices are due. The process is repeated weekly.
BidPay®’s auction fee is contingent on auction success. If an auction fails to deliver results that meet or exceed your financial objectives, BidPay® earns no fee.
UNPREDICTABLE SUPPLIER DISCOUNTS = GREATER BUYER GROSS MARGIN
Making discounts unpredictable to suppliers, combined with expanding the discount opportunity window, are the two most novel and critically important features of BidPay®’s design. When suppliers are unable to predict prompt payment discounts they are effectively precluded from building the cost of discounting into their pricing of your goods and services.
STATIC PROMPT PAYMENT DISCOUNTING MODEL = ZERO SUM GAME FOR BUYERS
By contrast, the practice of demanding suppliers to accept lengthy credit terms and/or pre-established, static prompt payment discounts is a zero-sum game that results in discounts and financing costs (at higher rates than yours) being built into the price of goods and services, adversely impacting your gross margin. If your company policy is to demand lengthy credit terms and/or prompt payment discounts, you are likely subsidizing your suppliers’ higher cost of short-term borrowing at your shareholders’ expense.
ACTIVE PAYABLE DISCOUNTING = REAL AND QUANTIFIABLE REVENUE
Active payable discounting offered exclusively by BidPay® provides your cash- and credit-constrained suppliers with a source of spot liquidity when they need it most. Equally as important, active payable discounting also provides your shareholders with the most profitable approach to prompt payment discounting. BidPay® is the first commercially available stand-alone active payable discounting technology.