The Power of Supplier Electronic Invoicing
When organizations are in the market for an AP Automation solution, they rarely think about how the solution they are investigating will also enhance their supplier relationships. This may seem like a selfish way of thinking, but that is not the case. The truth is, the problems they are trying to solve within their own company are enough to think about and probably justify the investment alone. But when we talk about ROI shouldn’t we be looking at the whole picture? This article will be focusing on benefits gained for your network of suppliers, a category often overlooked when reviewing electronic invoicing solutions to automate the accounts payable processes.
When suppliers are asked to do something different there is usually some pain and effort involved in making that change a reality. But when significant benefits are at stake you will likely see that adoption rates increase dramatically, especially when there is no cost associated with gaining said benefits. When automating accounts payable with electronic invoicing, your suppliers will instantly reap the benefit of visibility. They will know what approval stage their invoice is in and any issues associated with them, allowing them to communicate and fix issues within the platform in real time.
You and your suppliers will also gain submission efficiency with automated 2-way and 3-way matching. Suppliers can submit invoices only if correctly matched against the PO. E-invoicing will actually tell them exactly what and where the errors are so they are able to fix the problems avoiding any match exceptions. Suppliers and customers also love this feature because AP departments no longer have a pile of match exceptions in the office. Also, suppliers get paid faster which helps to enhance business relationships.
Since E-invoicing customers are paperless starting on day 1, Vendor Adoption Teams simultaneously start their work on converting the suppliers still sending paper. They pursue these vendors and educate them on the benefits they are missing out on. Many Vendor Adoption Teams average 50-70% supplier conversion to electronic submission within the first year! The pitch is easy, especially when there are no fees to the suppliers for any of the above benefits.
Supplier E-invoicing really does benefit everyone involved in the invoice lifecycle. Whether it’s the supplier, the AP clerk, AP Manager, Audit Team, Invoice Approval Managers; you name it…The benefits are everywhere.