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Electronic invoicing does away with hard-copy, paper invoices, and streamlines the accounts payable invoice receipt and validation process. By optimizing and automating this labor-intensive, exception-heavy process, companies stand to cut their invoice processing costs nearly in half.
OPI professionals can leverage a number of third-party tools that automate the invoice receipt process - from EDI, to any-to-any data delivery services, to global settlement networks. While some tools involve technology, others are purely service based offerings that do not require the purchase of software or hardware. The tool appropriate for each company depends upon a number of client-specific considerations, most notably each client’s relationship with suppliers, their quantity of suppliers, percentage of purchase order based invoices, and their existing system capabilities.
Data Delivery Format
With eInvoicing, supplier invoice data is sent from the supplier’s system directly to the client’s ERP system. Some solutions require pre-determined data formats in order to ensure compatibility, however, other eInvoicing tools accept data from suppliers in any given format and convert the data into the necessary format required by each client. Still others deliver invoices via a fully-integrated global purchase-to-payment portal which manages the process end-to-end.
Invoice Data Validation
Additionally, eInvoicing can be leveraged to ensure received invoices are complete and ready for processing. These tools can be configured to validate invoice data against pre-set rules and purchase order details, and either accept the invoice as complete for processing, or reject the invoice and notify the supplier of missing or inconsistent data. By ensuring that all delivered invoices are complete upon receipt, clients realize far fewer exceptions, increased accuracy, improved cycles times, and compliance with all purchasing requirements.
Supplier Participation
The success of eInvoicing is largely dependent upon supplier cooperation. While this may warrant concern for some companies, eInvoicing delivers significant benefits to the supplier as well. For example, some solutions provide suppliers with 24-7 web-enabled visibility into the status of their invoice. Given such benefits, and that the new invoice delivery instruction are streamlined and painless, most suppliers prove happy and willing to work with their customers.
Direct Business Impact
The business benefits of eInvoicing are far-reaching and go well beyond cost savings. Common benefits include higher on-time payment rates, greater capture of early-payment and on-time payment discounts, better control of payment timing, fewer errors and exceptions, enhanced visibility in supplier spend, compliance with VAT/tax and other regulatory requirements, 24-7 visibility into pending invoices, and improved supplier relations.
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