Jacobsen Witt posted an update 2 months, 1 week ago
Electronic invoicing, or e-invoicing, like the name implies, will be the electronic exchange of invoice documents from a supplier along with the customer. Electronic invoicing surpasses merely sending a PDF receipt into a customer via email. An authentic e-invoicing solution is an internal solution where a digital invoice is transmitted and received seamless between the supplier’s accounts receivable system and also the customer’s accounts payable system. E-invoicing documents are generally exchanged in EDI or XML formats. (Source: E-Invoicing Basics)
Why switch from a manual, paper-based system to an electronic invoicing system? Paper-based system is notoriously time-consuming and prone to errors. As such, paper invoicing has a tendency to have higher costs and longer processing lifecycles.
In spite of the widespread adoption of automation for many business processes, accounts payable and accounts receivable processes remain largely manual (Source: Dolphin Corp).
Benefits of E-Invoicing for Suppliers
Switching to e-invoicing solves these problems, leading to faster processing, lower transaction costs, greater visibility, and significant savings. From the business perspective, e-invoicing delivers advantages throughout the AR / AP process.
To begin with, there is not any mail to sort, distribute, or open. Not only this, e-invoicing eliminates costs associated with paper bills, envelopes, and postage. Plus, it takes significantly less time for you to process generate bill payment. With the new system, you could make and distribute a whole batch of invoices with just a number of clicks. (Source: Pay Simple)
Next, there isn’t any data entry required. Considering that the payment comes to the buyer’s accounts payable system automatically, the accounts payable clerk does not need to go into the data personally. E-invoicing eliminates the opportunity for mistakes and ensures accuracy. Likewise, there’s no need to scan paper bills, another manual method that will take time and is vulnerable to errors like illegible scans.
Meanwhile, all invoices are instantly and securely delivered. Through the elimination of mail from your equation, you happen to be also eliminating a couple of days from receipt to payment. Similarly, electronic payments speed the method and mean it’s not necessary to wait in the bank to deposit your hard earned money.
Electronic invoices are simple to store and reference, without any physical file cabinets required. When you contact customers, it is possible to add a link or attachment towards the original payment receipt, purchase order, or related documentation.
Important things about E-Invoicing for Buyers
E-invoices offer benefits on your customers too. For instance, you’ll be able to provide a variety of payment options like debit, credit, and ACH. Paperless system also paves the way to automated reminders complete with integrated “pay now” buttons that connect to the bill. Your customers’ accounts payable team will appreciate without having to manually enter data or scan paper bill, too.
Switching to e-invoicing saves time and expense, a win-win either way sides.
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