Too many procurement and AP teams are drowning in paper. The typical mid-market business works with hundreds, and sometimes thousands, of vendors at a time. The result is an endless sea of paper-based purchase orders, invoices, transaction documents and payment confirmations that need to be managed and tracked every single day.
This dynamic creates three big problems for growing businesses: increased overhead, a lack of control, and wasted time and talent.
For instance, the cost to process a manual invoice, depending on your market, can be anywhere from $12 to $30 each. Let’s take the mid-point ($21 per invoice), and imagine a typical mid-market business that processes 500 invoices per month, and an enterprise that processes 10,000. The estimated cost in these scenarios: $10,500 and $210,000 – monthly. That doesn’t even account for billing errors, duplicates and exceptions, all of which add time and cost.
To put it lightly: that’s a lot of overhead.
Driven by a need to cut costs and the rapid move to remote work, businesses everywhere are disrupting the status quo by digitizing and automating procurement and AP processes. In fact, recent market analysis projects that the accounts payable automation market will grow to 3.1 billion by 2024. The business need is so ripe that even Google is getting into the action.
For mid-market businesses, there are multiple benefits of digitizing vendor invoice management. Specifically, vendor invoice automation:
- Saves time and money. Automation is proven to cut invoice management costs by 40 – 50%.
- Improves remote workforce productivity. Digitization enables your team to work from anywhere and everywhere. No more paper invoices means no need to go into the office – this is critical in today’s remote environment.
- Catches billing errors and duplicates, ensuring you only pay for what you order and receive.
- Increases visibility and control, giving you more insight into where money is being spent, with what suppliers, and for what goods and services.
- Simplifies and improves compliance, reporting and spend management.
An added bonus? Today’s digital invoice processes also make it easier to manage your vendors – beyond simply requesting they email you digital files. By onboarding your suppliers onto a fully digital platform, you can receive electronic invoices directly from the supplier’s AR system or within the platform’s supplier portal.
As you plan your 2021 tech investments, measure the percentage of eInvoices you have today and take a hard look at how and where automation can improve efficiency, save money and increase financial performance. Procurement and finance departments are ripe for process automation. While the actual mechanics – digitizing paper invoices or moving to electronic payments, for example – may seem tactical, the financial and performance impact is substantial.