Most companies now recognise the benefits of e-invoicing. This can be seen by the number that engage in e-invoicing and automated payment processing, which continues to rise.
The reasons that e-invoicing is becoming more popular are that it’s quick and it’s accurate. These two factors allow companies to realise a wide range of benefits, including control of finances, visibility of cashflow and simplicity of technology processes.
Importantly, e-invoicing can be integrated seamlessly into financial and back-end systems. This ability to add e-invoicing helps companies get set up, and at the same time makes it easier to bring new suppliers on board more quickly. This helps to build and strengthen relationships between buyers and suppliers.
However, there are just too many companies still missing out on the benefits of e-invoicing. With only 16 per cent of businesses stating the majority of the invoices that they receive are electronic, a huge number of companies are still relying on archaic, paper-based processes and functions. As well as being more prone to errors, these processes are labour intensive, as the majority of invoices need to be scanned, captured and printed.
This leads us to another important distinction. You can email an invoice, but if you email it as a pdf that needs to be printed out and inputted into a separate system, it’s not e-invoicing! We’re talking about automating the process, so that you send, the receiver approves and the payment is made…and it’s as simple as that.
So, what’s stopping e-invoicing adoption? Companies are unnecessarily concerned about the complexity of implementation – although this seems to be less of a barrier as adoption figures are rising.
The key adoption issues lie with suppliers and their relationships with businesses. Companies believe there to be a huge challenge when activating the supply base. These issues involve lack of supplier onboarding capability, supplier reluctance and cost to the supplier.
These are all perceived challenges and actually lag market reality. Statistics show that supplier resistance is dramatically falling. In 2012, the key challenge of supplier on-boarding was cited by 30 per cent of businesses – this was a dramatic decline from a figure of 46 per cent in 2011.
The key to successfully moving your suppliers to e-invoicing is communication. There’s no such thing as over-communication – especially at the beginning of the process and in the migration phase. When suppliers really understand the huge benefits that they can achieve through e-invoicing, adoption inertia can quickly disappear!
Couple that with a straight-forward on-boarding process and you can become more automated and efficient very quickly. Making the path to electronic invoicing as easy as possible for everyone in your network is the key to achieving 100% e-invoicing.