Industrial painting equipment supplier Pittsburgh Spray Equipment Co. sells through an online store, but until recently the company relied on the laborious task of manually processing customers’ payments for online orders. Billing department employees manually input credit card information and processed paper checks customers mailed to pay their invoices.
“That was our flow. It was very offline and manual — heavy labor,” says Patrick Harmon, sales and marketing specialist.
In a manual system, customer payments don’t always arrive when promised, Harmon says. Often, 30-day payment windows extend to 45 or more days and employees may have to track down payments by calling and emailing customers, with mixed success. Moreover, vetting new customers also requires a lot of legwork, he says.
Automating the B2B payments process
Pittsburgh Spray needed a way to automate its B2B payments process. The company, which uses a Shopify Plus ecommerce platform to sell to B2B customers, added a payment plug-in from Balance Payments Inc. to make transactions easier for both customers and employees, Harmon says.
“I get paid immediately, and [Balance] handles all the collection,” Harmon says.
Through the plug-in, Pittsburgh Spray customers can pay via credit card or PayPal or request financing for net 30-day payment terms. Balance completes instant credit checks and handles financing requests for buyers at the point of transaction, a process that takes about five minutes. Balance offers instant approval for up to $50,000 to qualified buyers. The plug-in — which Pittsburgh Spray says it integrated with Shopify Plus within three hours — is designed to automate such tasks as invoice reconciliation and accounts receivable.
Pittsburgh Spray’s web developers worked with Balance to integrate it with its existing enterprise resource planning system, Harmon says.
Pittsburgh Spray has about 130 customers using the Balance plug-in, Harmon says. Approximately 5%-10% of its new customers use Balance at checkout, a share that Harmon expects to grow.
Some customers still prefer to pay offline
While more customers have welcomed the option to make online payments, others have been reluctant to change. But Pittsburgh Spray can still process offline payments for customers using the Balance plug-in. The plug-in is designed to smooth out and expedite the payment process for customers who prefer to pay offline as well those paying online.
New customers share their employer identification number online. Pittsburgh Spray submits the customer’s address and employee identification number. Balance then confirms or denies approval of the transaction and any request for financing.
Since adding the plug-in, the average order value for new customers who want the offline process has increased, Harmon says, without revealing how much more. Pittsburgh Spray employees now run offline requests through Balance.
“Maybe it’s a big product that takes a couple of weeks to get a hold of — we’ve been able to qualify them in about 10 minutes. This is instead of two weeks later for billing to give approval [under the manual system],” Harmon says. “It’s a much quicker experience with the user getting their approval and the amount approved.”
Once Balance approves the transaction, Pittsburgh Spray emails the customer to let them know they can send a purchase order, then receive an invoice and send a payment, Harmon says.
“That’s been tremendous. We’ve been bringing in a lot of high-value customers where I wouldn’t have been able to make the sale, or, not in the way they want it,” he says.
What it costs to automate B2B payments
Balance offers financing of the total order value for a small initial fee, which varies. Balance declined to share its pricing structure, but Pittsburgh Spray pays 2% of the order value on each transaction. Shopify Plus charges Pittsburgh Spray about 2.4% for credit card transactions.
Shopify announced new B2B technology in June 2022. The Balance app allows B2B merchants on Shopify to offer customers the ability to defer payment up to 60 days as well as pay in multiple ways, including ACH, credit card or check.
As ecommerce for digital commerce becomes more mature, the discussion around ecommerce payments will and should follow, says Bar Geron, founder and CEO of the payments technology vendor. Balance recently secured a $350 million credit facility from Viola Credit to ensure it can grow its trade credit system for B2B merchants.
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