Supplier Enablement

Electronic Invoicing : How big is big?

It is not so easy to implement as it depends on the participation of your supplier but eInvoicing is now beyond its infancy and is a fast growing industry.

Some statistice quoted at the EXPP conference in Berlin 25/26 September 2006 impressed me, and I quote them here:

340,000 businesses are now engaged in eInvoicing.

227,000,000 electronic invoices have been processed

Not all businesses have 100% of invoices served as eInvoices but many are making progress that over 2 - 5 years will have invoicing as a paper free zone.

Those that have made most progress have taken some positive action to ensure that suppliers comply, for example:

A CFO wrote to its suppliers and mandated eInvoices if suppliers wanted to retain their status as a preferred supplier. Suppliers were given 2 months to respond. Consequence, some opted in some opted out but it gave the supplier a choice.

Denmark passed a law requiring suppliers to submit electronic invoices. Consequence of non-complianace being that paper invoices were returned unpaid. Sweden will also follow this course with a law taking effect July 1 2009.

These actions suggest that there is a lot at stake for the organisation that is processing these invoices and the benefits are so great that you have to have the will to make it happen. That means being tough and it is a lesson to those that have tried and had limited success.

The private sector is generally secretive about what savings it achieves through its implementation of ideas/change whereas the public sector is very open and accountable.

Denmark claim savings of €120 - 150M. That is a big bag of savings!

Denmark public authorities process 15M invoices p.a

That is going to need around 1200 -1500 staff to process 15M invoice transactions p.a

Let's face it, processing invoices is one of those things you have to do. So by doing it at the smallest possible cost to the business it will free up resources to put behind other things that the business needs to do to stay alive and prosper. It makes sense.

Do we really need to dress it up anymore than that?

posted by FrankB @ Friday, September 29, 2006