International Supplier Payments: Best Recommendations

The importance of fulfilling supplier payments

For any company operating in the global market, honoring supplier payments is crucial. Non-compliance can have serious consequences for the company, such as damaging its reputation and complicating its business relationships. It can even result in legal sanctions or suspension of operations.

Therefore, honoring commitments makes processes flow smoothly and run efficiently and productively. This improves performance, satisfies the customer, and increases the company’s profits.

The advantages of having international suppliers

Let’s look at some advantages associated with having international suppliers:

• Improved competitiveness: by contracting with a supplier from another country, the company responds to a better offer in price or quality. In this way, it helps to improve its competitiveness.
• Cost reduction: undoubtedly, by having lower cost or higher quality inputs, companies can reduce their total costs.
• Innovation: acquiring innovation through international suppliers allows companies to remain competitive. This is undoubtedly a good business, because of its contribution to knowledge. It is also a competitive advantage.

Challenges of supplier payments

Among the challenges we can see:

• Language differences: to avoid confusion with international suppliers it is convenient to use a common language. English is the best option.
• Time differences: time differences can make it difficult to communicate and collaborate with international suppliers. On the other hand, banks may be open in your country and closed in the supplier’s country. Hence the importance of digital platforms for supplier payment: they are not bound by business hours.
• Currency changes: although the U.S. dollar is generally used as the international transaction currency, there may be changes in the parity of a supplier’s currency. As a result, it affects the costs of inputs purchased from international suppliers.

Solutions to overcome supplier payment challenges

Companies can take the following steps to improve the supplier payment process:

• Use a digital payment platform: of the payment methods, digital platforms present themselves as a smart alternative. They offer efficiency and affordability for making international payments. For example, the growth in the use of these platforms between 2022 and 2023 is $5.45 billion. With a trend of $162.68 billion in use by 2031 (Statista, 2023). 
• Automate the payment process: automating the payment process reduces errors and improves efficiency.
• Establish clear policies and procedures: clarifying both payment policies and procedures creates consistency in the use of company resources; this enables alignment of all processes with overall objectives.
• Create a strong relationship with the supplier: a strong relationship with the supplier can help resolve any problems with payments.

 Now, a valuable and intelligent alternative for companies to process payments to international suppliers is, without a doubt, the digital platform Airtm. Let’s see:

• It allows for quick and easy payments in foreign currency without the need to open bank accounts abroad.
• It offers competitive rates for international payments, saving money.
• Airtm has a robust security system that protects the data of companies and their suppliers.
• Furthermore, it offers a variety of payment methods, including credit cards, debit cards, bank transfers, and cryptocurrencies.