3 in 4 CFOs are looking to simplify their payment processes amid economic uncertainty

As economic uncertainty looms, CFOs are gearing up for potential challenges, according to the Billtrust 2023 CFO Recession Sentiment report.

The report, which surveyed 350 CFOs, found that 32% believe a recession is highly likely, prompting finance teams to take proactive measures to safeguard their organisations’ financial health.

Payment processes have emerged as a linchpin for maintaining a steady cash flow. A resounding 75% of CFOs underscore the significance of simplifying payment processes and expanding payment options, such as credit, to support customers during a potential recession.

This focus on payment refinements is especially crucial in the B2B sector, where cash flow consistency directly influences organizational stability and growth. Timely payments are seen as a testament to the financial health of B2B enterprises, and any delays or disruptions can have cascading effects, jeopardising the stability of the entire economy.

Additionally, half of the organisations are taking a fresh look at their debt structures by revising their existing financial frameworks or making necessary improvements. These measures showcase the proactive approach CFOs are taking, with their emphasis on efficient payment methods being just one component of a broader strategy aimed at steering their organizations confidently through economic challenges.

Perception and preparedness

The survey revealed that CFOs have a pervasive sense of concern when it comes to the likelihood of a recession by the close of 2023. In fact, a resounding 78% of CFOs anticipate an economic downturn by the end of the year, with nearly one-third of respondents believing a recession is ‘highly likely.’

Despite these apprehensions, there is also an undercurrent of resilience and optimism among financial leaders. While economic downturns have historically caused concern across industries, today’s CFOs are determined to buck the trend.

In fact, 63% of CFOs expressed confidence in their organizations’ abilities to navigate and potentially thrive amidst a recession.

This optimism is not just wishful thinking; it reflects a proactive stance. CFOs’ confidence is rooted in strategic planning, adaptive measures, and innovative approaches aimed at turning the challenges of a recession into opportunities for growth. Let’s delve deeper into the specific strategies CFOs are undertaking to fortify their organizations in the face of economic challenges.

Fortifying financial stability

Organisations across industries are currently undergoing a strategic shift to adjust to the economic changes. More than 80% of these businesses have revised their financial plans and budgets to better align with the evolving economic landscape.

The strategies adopted are varied, with over half (57%) cutting back on non-essential expenses and 52% exploring new financing methods.

Ensuring liquidity remains a top priority, as 44% of organizations are strengthening their cash reserves. Additionally, 40% are putting a strong emphasis on managing cash flow proactively.

Technology and efficiency as pillars of resilience

In a marked shift from conventional ways of conducting business, there is a clear trend favouring technological advancements. A significant majority (62%) of CFOs surveyed are increasing their technology spending to enhance the efficiency of existing processes and boost overall productivity. This heightened investment in technology aims to optimize operations and streamline workflows.

As part of this move towards modernisation, nearly 60% of respondents have incorporated digital solutions to support remote work. This adoption suggests a sustained movement towards a blended work culture, balancing both in-office and remote operations.

This push for technology is driven by the changing dynamics of today’s business landscape, which require adaptability. An overwhelming 74% of CFOs firmly believe that embracing technological advancements and transitioning to a digital-first model is not just beneficial but essential for the continued viability of their organisations.

Prioritising people

While financial adjustments and technological advancements are critical, a company’s strategy for resilience extends beyond these aspects. Central to this holistic approach is the emphasis on fostering strong partnerships and valuing people.

A significant 67% of CFOs are actively enhancing collaborations with their vendors, recognizing that the fortitude of an organization is as strong as its supply chain. Cementing these relationships is crucial for ensuring the flow of goods and services, fostering trust, ensuring quality, and safeguarding against unforeseen disruptions.

Preparedness is another key component of this holistic approach. Over 50% of CFOs are proactively crafting contingency plans with vendors, demonstrating forward thinking and an attitude of shared responsibility and mutual growth.

In the delicate balance between financial prudence and ensuring organisational capability, 62% of CFOs are equally prioritizing cost management and the retention of their skilled workforce.

Looking to 2024

The survey results clearly demonstrate that businesses are not simply worried about future economic issues; they are actively preparing for them. By emphasising financial adjustments, technology adoption, strengthening relationships, and keeping their workforce intact, CFOs are setting their businesses up to not only endure challenges but come out stronger.

For more information about the Billtrust CFO Recession Sentiment Report 2023, visit billtrust.com. 

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