The electronic invoicing revolution is here.
And, it comes with a host of benefits for businesses.
In fact, many governments worldwide have introduced new laws to help their countries switch from paper to paperless document exchange.
Yet, dozens of global companies and businesses struggle with e-invoicing implementation.
The question then becomes;
Why Does e-Invoicing Adoption Still Pose a Challenge for Global Companies?
Well, while the "electronic invoicing evangelism" has led to the use of e-invoices becoming mandatory in countries such as the United Kingdom, Spain, France, and Austria, there's one major problem – the rules currently apply to Business to Government (B2G) transactions.
Essentially, this means that even with all the hype around e-invoicing, more needs to be done to help popularize the phenomenon in the Business to Business (B2B) and Business to Customer (B2C) models, where most of the global document exchange plays out.
In the wake of B2B and B2C e-invoicing confusion, many business executives face the following problems:
Determining which data exchange solution they should choose to start exchanging e-invoices with their trading partners.
The e-invoice format they should use.
Whether to digitize only their Accounts Payable (AP) or Accounts Receivable (AR) processes or both.
And, bearing in mind that thousands of businesses still run their document exchange operations using paper exclusively, it doesn't come as a surprise that many are hesitant about going full electronic – even though they fully understand the benefits.
For starters, here's what adopting electronic invoicing means for your business:
Significant reduction of operating costs related to materials (postage, paper, ink) storage and handling – typically 50 to 60% savings.
Elimination of repetitive and manual tasks such as data entry, document classification, and labeling.
Faster processing and payment cycles – you can track and monitor e-invoices in real-time, reducing collection times and speeding up payments.
Protection against fraud – unlike printed invoices, e-invoices come with unique and distinctive seals and e-signatures.
Electronic invoicing software encrypts any mail to guarantee a safe exchange. That way, your data is secure against potential document losses or 3rd party intrusion.
As a progressive business executive, it can be detrimental to miss out on all of these benefits, especially if your competitors have found a way to make e-invoicing work for them and are now enjoying a competitive edge.
So, is there a way to overcome this challenge? Yes, there is. We'll tell you all about it, next.
Create a Sound e-Invoicing Strategy
Sure, we're coming out of a ravaging pandemic.
But, the COVID-19 crisis has forced thousands of companies to rethink their business strategies.
According to a McKinsey study
, the pandemic has fast-tracked digital technology adoption by a couple of years – and many of these changes could be here for the long haul.
Now, businesses are privy to the fact that they need to start using some kind of electronic invoicing platform or a modern Electronic Data Interchange (EDI) system.
That way, they can run their document exchange operations efficiently and collaborate with their trading partners in virtual realms.
As you'd expect, there are dozens of electronic invoicing solutions on the market. So, how do you choose the right one?
Finding the Ideal IT Solution for e-Invoicing
Any electronic invoicing platform worth your attention should help you solve your current challenges.
Put differently; you’re better off with a solution that allows you to do the following:
Send and receive e-invoices in various formats.
Share your documents via multiple distribution channels like web portals or email.
Achieve full compliance with the latest legal regulation in all the countries where your business operates – this is especially crucial for companies with a global presence.
On top of that, you should keep the following in mind before switching to electronic invoicing:
- The scope of your digitization project
Whether you’re a Chief Financial Officer (CFO) or a medium-sized business, you’ll want to consider the possibilities of further development.
For some companies, this development may mean geographical expansion, while for others, it might imply digitizing order management and logistic processes.
Moreover, some companies may want to enhance their communication processes by adding claim management, invoice reconciliation, or spend control.
Therefore, find the right balance to help you determine the direction that you want your e-invoicing project to take.
- Your trading partners and customers’ readiness to hop onto the e-invoicing bandwagon
As stated, many businesses are hesitant to adopt electronic invoicing.
In essence, this means that you must encourage your trading partners to move on with the times. You can even help them with the onboarding process.
The best way to go about it is to allow your partners to have a say on the strategy development to enable you to agree on elements like specific distribution channels, invoice verification, and approval rules and document formats.
And from Unimaze’s perspective, small partners should consider using a vendor portal to enable them to leverage a fully structured flow of documents and advanced reporting possibilities.
That said, where is business on the path to adopting e-invoicing?
Are you still trying to wrap your head around what an invoice is? Or, are you having a problem pinpointing the right e-invoicing solution? Maybe you’ve implemented e-invoicing already and are on a mission to onboard your trading partners.
Irrespective of where you are, stepping into the world of electronic business processes means having the right tools. Most importantly, it implies knowing how to use these tools effectively.
So, develop a robust e-invoicing strategy and run with it - after all, e-invoicing offers an opportunity to enhance your business process while nurturing a stronger relationship with your trading partners.
…remember, a goal without a plan is just a wish