Electronic invoicing, which is also known as e-invoicing is becoming popular in both B2B and B2C sectors. It is gradually replacing the old-fashioned paper invoice.
You will learn why companies should move with this idea.
Your company will be revolutionized by e-invoicing; just stay with me to the end.
Reports from IBM, GS1, and EY show that an average cost of 15 Euros is incurred by companies in processing a single document from the sender to the recipient (this includes opportunity costs, errors, delays, and postage).
Let us first understand the three kinds of invoicing.
|Paper invoicing||PDF invoicing||E-invoicing|
|Makes up a large percentage of invoices in most companies.||PDF documents are sent by email||Let us look at the advantages below.|
|Requires significant efforts||Can be offered for download.|
|The sender has to type, print, envelope, stamp, and send.||Mainly used in B2C sectors.|
|The recipient has to print it|
ELECTRONIC INVOICING (e-invoicing).
The good thing about electronic invoicing is that it saves over 66.6% of the costs used on paper. The following reasons explain why companies should move with electronic invoices.
Savings in time, shipping, and personnel costs.
Electronic invoicing reduces wastage of time and congestion of staff members since all invoicing tasks are done on the system. Other staff can be assigned to other tasks.
The invoices can also be integrated with local revenue authorities like TRA, KRA, and RRA
Reduces costs of paper, printing, and stamping.
Electronic invoicing also reduces material costs to up to two-thirds of the cost of paper invoicing. E-invoicing avoids huge paper use, printing costs, envelopes, and stamps. Digital stamps can be used on e-invoicing.
Faster payment due to faster processing of the invoices. Your company will be able to receive payments in a short period of time since the processing of invoices is done fast. The invoicing process may involve five steps;
- Capture general ledger
- Send invoice
- Authorize and submit an invoice for payments
- Process invoice for payments
- Archive invoice and payment information
Electronic invoicing goes through these steps faster than paper invoicing and PDF invoicing.
Simplification of archiving.
Electronic invoicing can store information for a long time. The computers might get damaged but the invoices can be saved on an online server or cloud.
On the other hand, paper invoices cannot be stored for a long time. Searching for the right invoice is also easier with electronic archives as compared to paper invoicing.
In a nutshell, electronic invoicing is generated on the sender’s side in machine-processable format for example EDIFACT or XML.
The process is fully automated. The invoices are sent to the recipient’s IT system without human intervention which speeds up verification and approval.
In conclusion; the above reasons clarify why companies must move with the idea of electronic invoicing. Make the decision today and choose faster growth by using e-invoicing. You can learn more here.