The hospitality industry is evolving rapidly, and embedded payment solutions are emerging as a game changer. With rising operational costs, tight labor markets, and increased fraud risks, organizations must adapt to stay competitive. Enter BirchStreet Pay – a solution designed to streamline payment processes, reduce risks, and foster efficiency for hospitality businesses.
During a recent discussion, Phil Beck, an industry veteran with 30 years of experience in banking and payments, painted an aspirational vision for digital B2B payments that seamlessly merge with procurement. Joined by Rob Smith, CFO of Crescent Hotels and Resorts, and Bob Cohen from MasterCard, the session offered valuable insights on why automated, embedded payment solutions like BirchStreet Pay could redefine hospitality finance.
Hospitality’s labor challenge
“Does anyone actually enjoy cutting checks?” If you’ve been working in the hospitality industry, chances are the answer is no. Rob Smith, a self-described payments veteran, described the exhausting toll of manual processes on accounts payable (AP) staff. Labor shortages plague the industry, with a staggering 73% turnover rate in hospitality jobs. Recruiting and retaining talent has become an uphill battle, compounded by repetitive, manual tasks that today’s workforce simply doesn’t want to perform.
Automation became the obvious solution for Crescent Hotels. By implementing BirchStreet Pay to manage their payments, Rob’s team dramatically improved efficiency. They reduced headcount in AP not through layoffs, but by reallocating employees to higher-value strategic tasks like financial analysis and supplier relations. Deadlines for property financial closings also became much more manageable, ensuring greater peace of mind for staff.
The upshot? Removing manual friction from AP is no longer optional – it’s critical for attracting talent, optimizing costs, and enabling your team to focus on more meaningful work.
Fraud in payments is closer than you think
Fraud isn’t just a buzzword – it’s an alarm bell ringing loud and clear. Phil Beck shared a startling statistic during the panel: more than 80% of organizations face payment fraud on an annual basis. This includes check fraud, which has ballooned in recent years thanks to sophisticated crime networks exploiting outdated check systems.
The hospitality industry remains especially vulnerable. Rob Smith mentioned a $91,000 fraudulent check issue caught by BirchStreet Pay’s security features. Someone had “washed” a check, reconstructed the beneficiary name, and attempted to cash it. The fraud was flagged and prevented.
Through tools like virtual cards – digital payment methods that can restrict use by dollar amount or vendor – BirchStreet Pay drastically reduces exposure to fraud. While traditional checks and ACH transfers are frequent targets for criminals, virtual card fraud rates sit at a near-zero fraction of a percent. When control and peace of mind are key, switching to more secure payment rails adds tremendous value.
Supplier relationships are key
Want to keep your suppliers happy while securing better deals? Pay them efficiently. Suppliers frequently call AP departments with payment-related inquiries, wasting time and eroding goodwill. As Bob Cohen noted, buyers who process payments quickly in predictable cycles earn trust and avoid supplier dissatisfaction.
BirchStreet Pay offloads much of this burden by handling supplier onboarding, inquiries, and even payment processing through portals when needed. The result is quicker payouts and fewer headaches for staff and suppliers alike. Crescent Hotels saw direct benefits here – sending payments as swiftly as the next day keeps their vendors happy and interested in doing business.
The Uber moment of payments
Phil Beck drew a compelling analogy between Uber’s seamless payment experience and the future of B2B payments in hospitality. With Uber, the payment is automatic, invisible, and hassle-free. That’s exactly how P2P processes should operate, argued Phil.
Currently, however, hospitality payments are far from automated. A shocking 40% of B2B payments still occur via paper checks, despite their inefficiency and environmental drawbacks. Not only do these checks cost upwards of $6 per transaction – they’re also major pain points for fraud and labor.
By embedding payments directly into procurement workflows, BirchStreet Pay mirrors the Uber experience. Once a payment instruction is issued, the rest is automated – reconciliation, security checks, and even vendor setup. Optimizing payment channels through digital options like ACH and virtual cards minimizes manual involvement while reducing cost and risk.
Rebates and revenue
Automation isn’t just about eliminating headaches – it also drives revenue growth. BirchStreet Pay offers rebate incentives for transitioning supplier payments to virtual cards. For example, Crescent Hotels moved from 17% to over 25% of their spend paid via virtual card, unlocking additional rebate dollars while streamlining operations.
Rob Smith emphasized that while rebates matter, they’re a by-product of broader financial health. The true prize lies in aligning a smoothly integrated payment process with strategic initiatives. From fraud prevention to labor reduction, automating payment processes generates savings in multiple dimensions.
Sustainability matters
Another hidden benefit of moving away from paper checks is sustainability. Reducing paper use, postage, and the carbon footprint associated with paper trail logistics aligns hospitality organizations with environmental mandates.
At its core, the shift to digital payments fits naturally into broader ESG (environmental, social, and governance) strategies pursued by global organizations in hospitality. Whether it’s simplifying processes for sustainability audits or reducing environmental waste, automation places companies at the forefront of their industry.
Bridging the gap
Not every organization operates on the bleeding edge of payment technology. Many are still at step one – handling manual checks and relying on decades-old infrastructure. The good news? BirchStreet Pay makes automation accessible wherever you are in your digital transformation.
Whether working with smaller properties or large management groups, BirchStreet tailors its solutions to scale. Starting with a simple payments implementation, businesses can build momentum toward full invoicing and procurement automation.
Unlock your vision
Embedded payments aren’t just a luxury – they’re becoming essential, particularly in high-pressure industries like hospitality. BirchStreet Pay not only simplifies payments but tackles industry-wide problems like labor shortages, fraud, and supplier friction.
If you’re still processing payments the old-fashioned way, consider this your call to action. It’s time to leave behind the paper backlog, ring-fenced fraud risks, and resource-draining vendor inquiries. With solutions like BirchStreet Pay, you can drive efficiency, ROI, and relationships – one seamless transaction at a time.