Skip to content

E-invoicing News

An Informative news and blog about iPayables and the electronic invoicing industry

Recently, I was speaking with a colleague of mine who asked me “why are so many airlines are using iPayables? Is it because of specific features that the airlines use? Is it because of a federal mandate to use an American business?  Is it because the founders of iPayables were all ex airline executives?”  The answer, of course, was none of the above. But the real reason is fairly interesting.

The first airline to adopt iPayables was American Airlines in 2001. At the time and over the next few years, the industry was suffering from rising fuel costs, increased government regulation, passenger safety concerns and in general; decreased passenger revenue. If you have been around as long as I have, you might remember how strange it was flying in planes that were less than 40% full during that time.

To combat this, most Airlines mandated a heavy emphasis on cost and head count reduction in order to survive and become profitable again. Inefficient processes in AP was one area of concern for carriers who were looking to streamline their business model. As an example, most of the airline’s AP Departments tended to pay their suppliers only after the invoice was fully approved by everyone and their dog, which usually took an absurdly long time (usually over a month)! On top of that, those departments needed dozens and dozens of people to process, verify and audit mountains of paper invoices.

It’s no wonder that when American Airlines first discovered iPayables at an industry conference way back then, and contemplated the ridiculously positive financial and efficiency impact it would have, for them it was a revelation! Even though electronic invoicing was at that time, in its infancy (iPayables was one of the early pioneers) many other airlines and even the International Air Transport Authority almost immediately, got on-board and the solution really took off!

Unfortunately, even though most of the major airlines have adopted iPayables as their AP Automation solution, others have been reluctant. Interestingly enough, there was at least one airline who had deep and detailed conversations with us about how our application works and about the possibility of adopting us. They then used the information gathered from us and attempted to build their own E-invoicing platform. Needless to say it did not go as well as they hoped, and they are no longer around.

Another airline decided to go in a different direction. They wanted a more European feel and went with one of our competitors across the pond. Eventually, that company got bought by a larger American company shortly, which you would think would be the end of the story.

However, that bigger American company decided to sunset (kill) the old invoicing product they were using and try to replace it with their solution which is even more overpriced and less functional.

The story takes another turn as that company recently got bought out by another American company and it is probable that they will turn to us for their AP Automation needs. It’s kind of funny how things come around!  With all of that said, I told my colleague how lucky we were to find those airlines when we did and have been able to cultivate partnerships that have endured and been profitable for all parties involved. Currently we serve more than 2/3rds of the world’s major airlines which represents about 25% of our revenue. We appreciate them and they have enjoyed partnering with us.

He was pleased with my answer and asked if any additional airlines were coming on board for which I answered that I am confident we are about to close another major US carrier shortly, but that’s another story.

Want to see more? Click here to see the stats from a recent survey of a few of our airline clients.

Tags: , , , , , ,

An electronic invoicing wave is currently engulfing enterprise organizations causing lower invoicing costs and faster processing times. Yet a similar, larger and more powerful e-invoicing wave is nearing shore, headed towards small to mid-market companies which make up the backbone of the US economy. Recently, iPayables has been surfing into mid-market, offering an enterprise level solution without the Fortune 500 price tag. But don’t let the vast enterprise-level capabilities of InvoiceWorks scare you, iPayables InvoiceWorks is configurable around how you do business… and we just have a lot of features available.

Small to mid-size companies who have narrower profit margins will certainly place a strong emphasis on cost reduction when setting company goals for the fiscal year. With a robust solution like InvoiceWorks in-place, those organizations can swell efficiency, and coast to additional revenue streams. In fact, with our Dynamic Discounting capabilities, we can actually transform your payables department into a profit center! If keeping your suppliers happy is important to you, just wait until you see the impact Early Pay has on your relationships (and your Income Statement). iPayables has three methods which we employ to capture discounts that provide an average return of 32% on our customer’s working capital which we are utilizing to pay suppliers early.

Watch now to see how Dynamic Discounting works.

Discount capture is just one hook in our tackle box. We have best-in-class Workflow and PO Matching, as well as offering numerous options to your vendors for submitting invoices electronically. It is a complete package from invoice submission to payment and archiving. As costs are receding, AP Automation solutions like InvoiceWorks are attracting more small and mid-market customers. Especially considering that many companies are making accounts payables automation a requirement due to inefficient processes or the need to reallocate headcount. Indeed, the payables automation tide is rising faster by the year.

However, the biggest challenge facing companies who are ready to make the switch from paper to electronic invoicing, is the plethora of providers who claim to offer ”The Complete” AP solution. When in fact, most only offer a watered-down version. Separating the OCR solutions from the Workflow solutions, then the Workflow solutions from the other automation solutions; is like getting caught in a rip-tide and pulled out to sea – it can be difficult to swim in the right direction or find the ideal solution before you get sucked into something potentially hazardous.

We feel the pain of these customers because when they eventually get around to talking to us, we hear about the journey they have endured. Naturally, we do take some responsibility in that regard, as we don’t spend near as much money on marketing as our competitors do, and for that we apologize. Most our proceeds (we are self-funded, organically grown and privately owned) are spent on R&D – building new applications and features that help out our current customers and expand our offerings for our future customers.

Luckily, we also have the flexibility to change pieces of our business model to accommodate a mid-market price point while offering the same enterprise level AP solution. All of our customers have seen a year 1 ROI when embarking on this initiative… and we certainly don’t plan on changing that aspect of our model in the mid-market. I hope this post has been enlightening to our future customers, helping them find the ideal automation solution. Regardless of your company size, we can transform your AP process into smooth sailing!

ADAM LEVIN is a SALES MANAGER for IPAYABLES and contributed to this months post.

Tags: , , , , , , , , , , , , ,

 I come from a consulting background doing process redesign and large IT Implementations for a major consulting firm.  One of the areas which I greatly enjoy is finding solutions to problems.  There is usually a better, cheaper, faster, more enjoyable, more profitable way of doing most anything and electronic invoicing is no exception.

One of the questions I get is how to implement an electronic invoicing solution.  How you implement really depends on the type of solution you are going to use.  The number of features requested and the complexity of your needs are key items driving the answer to these questions.

I like to break it down into the 4 general areas:

Step 1:  Understand the scope of what you need and what you are implementing.

You may start with a limited solution which includes only up-front imaging, no workflow, no payment, with invoices loaded into your ERP system for processing.

You may instead be doing a more comprehensive solution which includes a vendor portal, up front-imaging, multiple file imports, workflow, PO matching, payment processing and invoices loaded into your ERP system for processing.

Step 2:  Establish a realistic time frame for the type of solution and level of change management.

A limited solution may have little configuration required and few users involved from a processing perspective and therefore can be accomplished in a shorter time frame.

A more comprehensive solution while providing many more benefits, generally has additional configurations so that the system meets your specific needs and this may take some additional time.  The number of users involved, generally from a review or approval perspective, also plays directly into change management activities.

 Step 3:  Configure the system for your specific requirements.

The service provider you have selected should discuss with you the solution best suited for your company and how the various options available will best be able to meet your needs.

This is the part I feel is most important.  Automating a bad process leaves many of the benefits left on the table.  Having a knowledgeable team who has seen both the best and not-so-best practices at numerous companies will be able to share with you what has worked with companies like yours.  This is an invaluable opportunity.  In addition they are undoubtedly cheaper than what most consultants would charge just for a review of your processes alone.

So look for a service provider who will work with your staff and help you apply the best-practices for your company’s situation.  In this way they can help you achieve the benefits you are looking for.

Step 4:  Roll-out, ramp-up and enjoy the benefits and fruits of your efforts.

Electronic invoicing is, at the end of the day, a tool for Accounts Payable.  It is not outsourcing, it is not giving up your role, not giving up control and not a replacement for account payable.

It is a tool; it is a resource for you to make your department an even greater asset to your company.  One key way that you can do this is to take advantage of the partnership offered by your provider.  Think of them as an extension of your department.  Their goal should be to make you successful and this is best accomplished by effectively rolling out and gaining participation of this effort.  You do not need to do this alone.  They are there to help make you successful.

As I said earlier, there is usually a better, cheaper, faster, more enjoyable, more profitable way of doing most anything.  Electronic invoicing is here and ready for those Accounts Payable departments ready and willing to make the change.  Pick up the tool, become a partner and see what we can accomplish together.

Robert Ripley is Chief Operations Officer at iPayables.  His experience at iPayables and previously at Accenture includes IT Integration, business process design and AP Automation with Fortune 500 companies.

Tags: , , , , , , ,

The evidence in favor of switching to automated invoice processing is pretty overwhelming. As well as being faster and more efficient, automating the process of capturing invoices can save your company money at every stage. But persuading your company to make the switch can be daunting; not only does it involve changing the established system, but there are significant upfront and ongoing costs involved.

Convincing your company to start automating its invoice processing depends on successfully demonstrating that the return on investment for accounts payable automation is worth the cost, and for that, it is important to have a strategy to support that case. You can build this strategy by answering four basic questions.

Question #1:What is paper process really costing my company?

No matter how skilled your accounting department may be, any system that relies on manually inputting data from paper is slow and subject to human error. Every time a piece of paper changes hands, the opportunity to misread, misplace or misunderstand something is introduced. For a company that handles tens of thousands of invoices per month, even a small margin of error can result in huge losses (For some companies, these losses could be in the millions).

An electronic invoice system almost completely eliminates the potential for human error and there is no longer a need for lengthy data capture. Authorization can be done with the click of a button rather than by funneling paper from department to department. Automating your accounts payable process not only reduces error rate but also increases visibility and control.

Question #2:How much money could we save if better appropriated our skilled labor force?

Once the lengthy data capture process has been eliminated from the invoice processing system, the burden on the accounting staff decreases dramatically. Employee hours – often hundreds per month – that were once dedicated to efforts such as manual entry, routing, and filing can be used more efficiently, either by reducing the accounting staff and lowering the overhead, or by reallocating them to tasks that are of more profitable use to the business such as creating an audit team.

By automating the AP process, your company can produce large amounts of easily accessible data about the operations of the business; analyzing this data for trends and patterns that could benefit the company is a far more profitable use of employee time than the arduous task of processing paper invoices by hand.

Question #3:How much money are we missing out on with lost discount opportunities?

It is not uncommon for suppliers to offer discounts for early payment – after all, the sooner a supplier is paid the better their own cash flow situation will be. Typically, the discounts apply to payments made within ten days of receipt of invoice, but with a paper system it is almost impossible to process an invoice in fewer than ten days (the average processing time is closer to thirty). Switching to an automated AP process that includes e-Invoicing, workflow, PO Match/Flip like iPayables InvoiceWorks, drops the average processing time down to three days, which is well within the window for any supplier’s discounts. Even small discounts make a difference when multiplied by thousands of invoices, and the ability to capture those discounts consistently can save huge amounts of money.

For those contractual discounts that are still not captured in time, iPayables offers Auto Slopping which offers suppliers early payment on a sloped discount rate based on a predetermined APR.  For example: a 32% APR a supplier could be offered a 1.89% discount for missing the contract date by a day. Lastly, Dynamic Discounting comes in to play by offering all of the suppliers that don’t offer discounts an opportunity for early payment. By using advanced algorithms in real time to determine justifiable discount terms for the supplier, iPayables helps you capture discounts that normally wouldn’t have been available to you.

Question #4:Does the gains of implementing an APAutomation solution outweigh the cost?

Between losses in efficiency due to over staffing and misuse of human capital, a high error rate because of manual entry, and lost discounts, along with other miscellanea, a company’s per invoice average cost can be as high as $15-$20 per invoice. In a large company handling tens of thousands of invoices per month, this equates to millions of dollars of loss.

By reducing the potential for human error and automating the authorization process by switching to an automated accounts payable process, you can lower your cost by more than 70% or more. In the latest Aberdeen Report, analysts have determined three key performance indicators that define the “Best-in-Class” AP departments and these are:

1)  4.1% days to process and invoice from receipt to approval.

2)  $3.34 average cost to process an invoice from receipt to approval

3)  90% capture rate for available early-payment discounts

These same analysts have determined that these “Best-in-Class” companies have achieved these through automating. Start-up costs and monthly fees of even the most expensive invoice automation systems start to look like a drop in the ocean next to the millions of dollars that can be saved each month. At iPayables, in most cases the return of investment is in the triple digits. And that is a business case no department head can ignore.

FERNANDO LUGO JR.  Regional Director of Sales for iPayables and in charge of  enterprise accounts in industries of healthcare, finance, and energy.  Before iPayables, Fernando was Director of Business Development for Globetek Media, a US based technology consulting firm with an International focus. Fernando contributed to this months post.

Tags: , , , , , , , , , ,

When the time comes for an organization to review options or even pull the trigger on a new investment or project, the notorious return factor will always be the focal point. Many possible initiatives are deemed hard to justify and thus, fall to the wayside. Either because the benefits received are intangible, or the benefits are tangible but hard to quantify. Another justification against it, is that it might take too long for the benefits of a potential investment to come to fruition. It’s an unfortunate truth that many businesses will fail to capitalize on golden opportunities to gain further profitability and perhaps even fail altogether by not being more intuitive.  

These types of arguments however, don’t apply to Electronic Invoicing. Switching from paper processing to payables automation (e-invoicing), often yields immediate impacts that are rather apparent. The numbers alone are often quite impressive and make a compelling argument. A favorite saying (albeit cliché)  amongst our sales team is that our “solution sells itself.”

So how does InvoiceWorks really sell itself? Our research has shown the majority of iPayables customers hit the “break even” point within the first year. Or in other words, you can potentially make more money implementing AP Automation than what you paid to use the service before the end of your first year! In fact, with the use of our dynamic discounting feature, returns for some of our larger clients have yielded in upwards of 300%! Considering some of our clients are some of the largest companies in the world, those numbers are very substantial.

In addition to ginormous monetary returns, there are plenty of other often overlooked, but still meaningful benefits when implementing a top-tier e-invoicing solution like InvoiceWorks. One obvious example is the decrease in environmental impact an organization can have when completely eliminating paper from its accounts payable department. Imagine the hundreds of thousands of paper invoices that were processed by our customers prior to switching to iPayables!

Not only does InvoiceWorks increase an organization’s transparency and accounting accuracy, it can also reduce head count and allow companies to re-allocate valuable employees to other areas of the company. As you can see, there are many residual benefits that go beyond the financial impact of transforming your AP department into a revenue generator.

Automating your payables process also benefits your suppliers who can take advantage of Dynamic Discounting / Early Pay feature. In fact, just sending invoices electronically using InvoiceWorks to our customers means that a supplier will be paid 30-40 days earlier than by using paper. Further flexibility is afforded them by choosing to be paid early if they are willing to cut a few points off the total invoice cost (Dynamic Discounting).

Unlike our competition, we don’t charge suppliers to use our platform and we have a team that is dedicated to actively reaching out to all of them to get them on board. We help answer any of their questions, and help with the technical aspects of getting up and running with iPayables InvoiceWorks. Still not convinced? Give us a call at (949) 916 -7407 or visit our website at http://www.ipayables.com. We will be happy to perform a custom ROI analysis tailored to your business needs.

ADAM LEVIN is a member of IPAYABLES SALES TEAM and contributed to this months post.

Tags: , , , , , , , ,

“I hate shuffling paper and with today’s technology dealing with paper is so inefficient.”

This was a quote from a VP of Finance responding to the question; why do you believe that E-invoicing is such a good product for your AP Department? A few other AP Managers and Controllers responded and contributed to this topic.

From a Controller of a Service Company came this response, “Because you don’t have to rely on it to come in the mail, it comes faster and you can reference it into your accounting program. It also allows you to keep it into your computer so you can easily reference it and file it in a jungle drive.” Sic

It’s extremely important for invoices to be dealt with in a timely fashion.  Relying on the mail when processing invoices could be a disastrous proposition especially when referring to time and money. I just saw on the USPS website information regarding mail delays due to a snow storm on the east coast.

Winter Storm

The north east is bringing heavy snow and mixed precipitation throughout the Mid-Atlantic and Northeast. The Postal Service is currently experiencing impacts to delivery and retail services in Georgia, South Carolina, Virginia and the Washington, DC area. Further delays are expected in Pennsylvania, New York, South Carolina, Virginia and Washington, DC. We will make every attempt to provide service where it is safe to do so.  Please check back for updates.

With E-invoicing there are no mail delays, therefore it comes faster and more efficiently. Efficiency is also manifested in how easily it can be incorporated into your accounting system.  You can import invoice data to your ERP system, reducing mistakes made manually. Electronic Invoicing brings you instant access to your invoices instead of having to search through file cabinets and chasing down paper copies.

A Controller answered the question and said, ‘“It simply costs too much; too much to buy, too much to print, too much to sort through, too much to attach, too much to scan, too much to store. Electronic invoicing allows both a vendor and their client/customer to be more efficient and save costs. One of the largest is labor costs. It is surprising how small and efficient an Accounts Payable Department or Invoicing Department can become through E-invoicing.”

My last response came from an AP Manager of a Healthcare company.  He said, “Freeing employees from the daily grind of mindless processing permits them to engage in tasks which are more appropriate and satisfying to today’s Accounts Payable workers, and (I believe) benefits an organization with a more productive allocation/ratio of equipment and human resources to the discipline of Accounts Payable.”

These responses came from those who work day to day in Accounts Payable and are making Electronic Invoicing happen within their organizations. They see how E-invoicing is faster, quicker, more efficient, and saves money with instant access.  They also are experiencing reduced labor costs that are freeing up time for better productivity in their organizations. They understand why businesses believe in E-invoicing and are making Electronic Invoicing their choice to process invoices. As a result, they are turning their AP Departments into profit centers.

Tags: , , , , , , , , , ,

7979940_lIf we take a minute and look back to all the business technologies that have come and gone over the years, it’s easy to agree that in recent times the internet has had the most impact on these “transitions”. In order to stay competitive, a business needs to be on the forefront of innovation and efficiency. Take the music industry for example; the brick and mortar companies that didn’t change their business model to compete with iTunes and online radio are now nonexistent. The same thing is happening right now with bookstores and magazines competing with products like the Kindle.

The point being that obvious trends should not be ignored because there are always consequences for lack of action, especially when it comes to this internet thing. These consequences aren’t always the collapse of an organization, but perhaps the missing out on millions of dollars’ worth of savings that might come in handy someday. Now, how would you define or identify an obvious trend? I think a good example would be how multiple governments around the globe are making a certain business technologie like electronic invoicing mandatory. These policies along with the natural progression of technological advancement, hint at what’s beyond the horizon. I’ll quit being ambiguous and simply state that Electronic Invoicing or AP Automation is sweeping its way around the world like a technological tsunami and the only way to not fall behind is to hop on the wave!

A technology journalist named Elaine Graham nailed it with the following quote in a recent publication: “Whatever the remaining technology and legislation challenges, at whatever stage various regions are in the adoption cycle, and however many pros and cons there are in the business case of implementing or outsourcing e-invoicing, one thing has become increasingly clear to both the global corporate community and governments over the last decade…” e-invoicing “is one of the most important strategies going forward for improving productivity and preserving the environment, given the billions of tons of paper invoices generated globally each year”. She obviously agrees with my technological tsunami analogy.

A robust AP Automation solution like iPayables InvoiceWorks contain powerful tools like Dynamic Discounts and Early Pay which can help to sustain and better manage a supplier’s cash flow long-term. It has been well documented that most business fail not due to it’s non profit margin, lack of sales or heavy competition; rather it stems from inability to manage cash flow. Whether it’s the environment, efficiency, savings, increased accounting accuracy, or even turning your AP department into a revenue generator… you can’t argue that it’s a good idea to implement this new and rapidly advancing technology. Are you ready to ride the e-invoicing wave? Contact us today! http://www.ipayables.com

ADAM LEVIN is a member of IPAYABLES SALES TEAM and contributed to this months post. Before iPayables Adam was the Regional Sales Manager for Channel Vision Technology, covering an 11 state market in the South Central and Southeastern United States. Channel Vision is a manufacture of over 700 products in the Custom Electronics industry. 

Tags: , , , , ,

Follow

Get every new post delivered to your Inbox.

Join 2,077 other followers