Convincing Vendors to Invoice Electronically: Have You Pointed out All the Benefits?
Are you still dealing with piles of paper invoices? While you probably realize that e-invoicing (invoice automation) is a better way to go for both you and your suppliers, some of your suppliers don’t seem to agree. That’s why we’ve created this e-Invoicing Benefits Checklist for you to use to make sure you’ve pointed out every last benefit to your reluctant suppliers.
AP Now’s e-Invoicing Benefits Checklist
1) Have you pointed out to your suppliers that faster receipt of invoices means it is more likely you’ll have the invoiced processed in a timely manner resulting in payment on the due date? By eliminating mail time, you shave three to five days off the process.
Yes
No
2) Have you pointed out the cost savings associated with not having to print and mail invoices? Plus, no one has to stuff envelopes or take the printed invoices to the post office for mailing.
Yes
No
3) Have you pointed out the cost savings associated with not having to pay for postage? That’s pretty obvious, but just the tip of the iceberg when it comes to savings for your suppliers.
Yes
No
4) Have you pointed out the cost savings related to salaries of associates who won’t have to manually stuff of invoices in envelopes?
Yes
No
5) Have you pointed out that invoices will no longer be lost in the mail? What’s more, with electronic invoicing, customers can’t even pretend the invoices were lost in the mail when they were delivered. And, if they do claim that, an invoice can be resent in a matter of minutes, not days.
Yes
No
6) Have you pointed out that should the vendor lose an invoice, replacing it will be simple and inexpensive?
Yes
No
7) Have you reminded your suppliers that with e-invoicing there’s no need to take invoices to post office?
Yes
No
8) Have you suggested that in the unlikely event they had to send second invoices if a customer (not you, of course) hadn’t paid by due date, the process is much simpler than in a paper-based environment?
Yes
No
9) Have you reminded your suppliers that if and e-mail address is not good, they would be notified immediately, not two to eight weeks later when mailed invoices finally come back or when they call looking for a late payment?
Yes
No
10) Have you also noted that invoices don’t get damaged in the e-mail the way they occasionally do in snail mail? So, there’s never a need to ask for a replacement invoice for this reason.
Yes
No
Discussion of AP Now’s e-Invoicing Benefits Checklist
We don’t think it necessary to go through each of the items on the checklist in individual detail. We think the responses are obvious. All of the items on the checklist are benefits to the supplier sending invoices. Clearly, there are also a whole slew of benefits to the customer, as well. But the purpose of the checklist is to arm organizations who are trying to convince vendors to bill electronically so the focus is on that end only. That is why we don’t discuss things like making it easier to earn early payment discounts.
That’s a clear benefit to the customer and with interest rates as low as they are, many vendors would like to eliminate them completely. So, it is better not to mention them when trying to convince suppliers to start billing electronically. There is one exception. If you have a supplier strapped for cash who is often pushing to get paid earlier and it offers an early-pay discount, then by all means, mention that as a factor when trying to convince that vendor to bill electronically.
It should be noted that while the biggest return is an automation of the whole process, this is not an all or nothing proposition. If the only change you can make is to get vendors to send invoices by e-mail, that is a big step in the right direction and don’t dismiss it. Grab it. Many of today’s third-party invoice automation models have the ability to accept invoices sent by e-mail.
If you can’t convince a particular vendor to convert, don’t give up. Periodically go back to them to see if they’ve changed their position. While you may not be a big enough customer to make them see things your way, another customer might. And, once they start doing it for one, they are likely to see the benefits and be more than willing to do it for your organization as well.
Mary S. Schaeffer, a nationally recognized accounts payable expert, is the founder of AP Now, a company that creates business intelligence on all issues impacting the accounts payable and payment function. She is the host of the AP Now Podcast.
