A $500M Food Manufacturer Cuts a 5-Day Cash Application Lag to Zero and Closes Deductions That Used to Sit Open Forever
The Objective
To stop cash from sitting unapplied for days, and to stop unresolved deductions from sitting open indefinitely.
The Background
This is a $500M food manufacturer and distributor based in the Southeast U.S. Its payments arrive roughly 40% by ACH, 30% by check via lockbox, and 20% by card. They come from a customer base where spillage and wastage, inherent to the spice trade, generate deductions constantly.
Before Global PayEX, cash sat unapplied for days and unresolved deductions stayed open indefinitely. Today, more than 100 buyers are fully onboarded on the platform, not just a pilot subset, and the results below come from two years of live production.
The Numbers
to apply cash
Invoices matched first time, including tolerance
Average receipt-to-posting cycle time, with a same-day median
Coded to the right accounts every month, $1.6M a year at current run-rate
Card MDR, via L2/L3 data qualifying
for lower interchange
Revenue growth over two years, with no change in AR headcount
The Challenge
Cash sat unapplied for days, and when a deduction could not be identified, the invoice simply stayed open, indefinitely, with nobody chasing it. Most of these deductions traced back to the same source: spillage and wastage inherent to handling bulk spice product, arriving as weight and quality claims with little or no explanation attached.
01
Cash Unapplied for ~5 Days:
Payments took roughly five days to be applied.
02
Missing Payment Advice, No Fallback:
When payment advice was missing, the only recourse was manual follow-up, with no fallback.
03
Unresolved Deductions Holding Invoices Open:
An invoice with an unexplained deduction was held open indefinitely, and no one was chasing it. Resolving a deduction took roughly 45 days.
04
Ad Hoc, Manual Customer Chasing:
Chasing customers for answers was done ad hoc and by hand, so unexplained amounts sat invisible in an open-invoice list with no owner.
Our Solution
The fix was not better detection. It was changing what happens after a deduction cannot be immediately explained. With Global PayEX, the manufacturer now handles cash application and deductions this way:
01
Cash Applied the Day It Arrives:
Days to apply cash fell from about five to zero.
02
A Fallback for Missing Payment Advice:
Cash is applied within one day if the advice arrives. Otherwise it is applied provisionally, and the application is reversible if corrected later.
03
Invoices Close Immediately:
The original invoice closes right away, in full, rather than stalling while an unexplained amount is investigated.
04
Deductions Become Tracked Residual Debits:
The unexplained amount becomes a separate, tracked residual debit, not a stalled invoice.
05
Automated Chasing Until Resolved:
An automated emailer chases the customer for justification on that specific amount, on a repeating cadence, until it resolves, instead of the amount sitting invisible in an open-invoice list with no owner.
06
Lower Card Costs through L2/L3 Data:
Level 2/3 data qualifies card payments for lower interchange, taking MDR from 2.95% to 1.9%.
The Results
Two years into live production, cash is applied the same day, and deductions that used to sit open forever now close and get chased automatically. These are live, measured results, not a projection.
| Before | After |
Days to apply cash | ~5 days | 0 days |
Missing payment advice | Manual follow-up, no fallback | Applied within 1 day if advice arrives; otherwise applied provisionally, reversible if corrected later |
Unresolved deduction | Invoice held open indefinitely, with no one chasing it | Invoice closes immediately; the deduction becomes a tracked residual debit |
Chasing the customer | Ad hoc, manual | Automated emailer, ongoing until resolved |
Days to resolve a deduction | ~45 days | — |
The measured outcomes at the current run-rate:
- $133K coded to the right accounts every month, which is $1.6M a year at the current run-rate. Across the pilot to date, $602K has been coded.
- 99.5% of invoices matched first time, including tolerance.
- 0.5 days average receipt-to-posting cycle time, with a same-day median.
- Card MDR down from 2.95% to 1.9%, via L2/L3 data qualifying for lower interchange.
The value goes beyond the transaction. Revenue grew roughly 50% over two years, and AR headcount did not move.
- Dispute visibility for sales: Account teams can see a customer’s open deductions before a sales call, so a billing dispute becomes a relationship conversation instead of a surprise.
- Buyer payment behavior, to the CFO: Which buyers pay late, and how consistently, feeds directly into decisions on payment terms and early-pay discounts.
- A cost problem, quantified: Deductions tied to one logistics provider’s handling were isolated and quantified, giving the CFO’s team a real number to bring into that renegotiation, not just a sense that something was off.
The same pattern applies to any receivables book where deductions, not payment channel, are the real bottleneck.
“A highly adaptable solution that has transformed the way we do business”
We have been using FreePay since 2017 and the improvement and efficiency it has brought in our collections and account receivables management has been remarkable.
FreePay has helped deliver electronic invoices to our Channel Partners in real time, process payments with all our business terms plugged in and taken care of our end-to-end customer account reconciliation.
Our Channel Partners have also been very appreciative of introducing FreePay to them especially for its feature capabilities, ease of use, transparency and customer support, without adding any cost to them.
Joseph Selvakumar , Vice President – Commercial ,
V-Guard Industries Ltd.
Saranathan Ranganathan
EVP & Head of Finance
ITC (TM&D)
"Our accounts teams are delighted with the time & effort saved, and there are much fewer instances of accounting errors. AlgoriQ has automated every step of the reconciliation process, including identification of commission & deductions, accounting them into respective ledgers, and transferring entries to payables."

Saranyan R
Chief Finance Officer
TTK Prestige

Jyotsna Sharma
Chief Financial Officer
Bridgestone India

Jessica Chan
Director of Treasury APAC
Stanley Black & Decker
"We have been using FreePay since 2017 and the improvement and efficiency it has brought in our collections and account receivables management has been remarkable. It has helped deliver electronic invoices to our Channel Partners in real-time, and process payments with all our business terms plugged in."

Joseph Selvakumar
Vice President - Commercial
V-Guard Industries Ltd.

Ranjan Choudhury
Treasury Global Delivery Center Leader
3M
Want to fast track your cash flow and grow your top-line?
Reduction in Manual Efforts
























