Author Archives: Rodrigo Martinez

28/10/2020

Getting EDI ready for peak season

Peak times can be chaotic for retailers. Christmas alone can account for almost 15% of all eCommerce transactions in a year. In 2019, sales during the Christmas period in Australia were forecasted to reach $52.7 billion. Managing an inefficient supply chain can be overwhelming at this time. Some of the main issues that businesses face are:
  • too many orders to fulfil for existing staff
  • increased costs during peak times
  • delays in order delivery for customers
  • not enough stock of goods.
The good news is there’s a way to help reduce these issues and make things easier for your business.

How EDI can help during peak season

Simply put, EDI (electronic data interchange) is the exchange of business information directly between business software. Think of a purchase order being created in one company’s accounting package, and it ‘magically’ appears in the supplier’s software; no email, no PDF, no manual data entry. Well, it’s not magic, it’s EDI!
Buyer enters the purchase order in their software Purchase order appears in Supplier’s software Supplier enters the invoice in their software Invoice appears in Buyer’s software
So how does it help businesses cope in peak times?

Reducing manual processing

Manual processes are a major issue businesses face during peak times. As orders increase, so does the work for staff. Using EDI, many processes are automated making it easier for staff to complete tasks faster and move on to others. Research shows around 75% of businesses believe they can process most inbound EDI/XML connections without a human touch. Studies also show that EDI can speed up business cycles by 61% and the order-to-cash cycle time by more than 20%. This means suppliers receive orders from customers sooner and they can process and deliver the goods faster. Overall, this helps reduce the risk of delayed deliveries and helps retailers keep stock at optimal levels. EDI can also be used by logistics companies to provide updates on deliveries. This helps reduce delays and gives more visibility for their partners during delivery.

Improving data and reducing errors

With less manual processing through EDI automation, the risk of errors is reduced. Less errors means data is more accurate and is more useful when it comes to forecasting. Data accuracy is critical for predicting demand and ensuring you have the right stock levels. Reducing errors is also important for avoiding ordering the wrong goods or amount of goods. These errors can impact your stock on hand for customers. In peak times, this damage your brand and potentially lose new customers. Using EDI removes most of the manual inputting making it harder for amounts to be incorrectly typed in.

Reducing costs

During times of high order volumes and demand, processes increase. This means businesses need more resources, including staff, to cope. EDI reduces costs through the automation of business processes. That can be the difference between needing to hire extra staff to help process orders or not. Another cost that increases as orders do are paper and filing costs. With EDI all documents are sent and stored electronically eliminating costs of printing and filing. If you’re interested in learning more about EDI and how it help your business this peak season, fill in the form below and we’ll get in touch.

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EDIRetailers

26/10/2020

Why government is so keen to implement eInvoicing?

Many organisations around the world are implementing eInvoicing, in particular government agencies. So why is government leading the charge? Here are a few reasons:

It benefits the economy

One of the key reasons government agencies are adopting eInvoicing is to stimulate the economy. It helps increase businesses’ cash flow because payment times are generally reduced. The Australian government even promises to pay eInvoices within 5 days for contracts less $1 million. In fact, studies estimate eInvoicing could provide the Australian economy with over $30 billion in benefits over ten years.

Benefits to government agencies

eInvoicing brings many benefits to government agencies themselves. These include:
  • Streamlined processes eInvoicing saves time processing invoices and payments by automating what would be manual processes. You don’t need to enter invoice information into your software, it just appears.
  • Fewer errors Less manual inputting also means less errors and more accurate data for reporting.
  • Reduced costs Because of the automation, workload and labour costs are reduced. And because there’ll be less errors, agencies avoid the added costs of fixing mistakes. Another critical cost that can be reduced is printing and filing. Overall, studies have found that it costs $30.87 to process a paper invoice, $27.67 a PDF invoice, and only $9.18 to process an eInvoice.
  • Faster payments eInvoicing can significantly speed payment processing due to automation. The average eInvoice is processed in 5 days, compared with 23 days for a regular invoice. This can help government agencies improve their supplier relationships and meet their promised payment terms.

Leading from the front

The government here in Australia is looking for ways to facilitate the adoption of eInvoicing. They’re leading from the front by implementing it with their own agencies first – they’ve mandated the use of eInvoicing for all Commonwealth government agencies by July 1, 2022. They’ve even promised $3.6million to help government agencies transition to eInvoicing and allocated $2.5 million to upskill workers and SMEs. There are a few agencies that are already accepting eInvoices. Some of them include:
  • The Australian Taxation Office (Australian government department)
  • The Department of Finance (Australian government department)
  • Services Australia (Australian government department)
  • The Treasury (Australian government department)
  • New South Wales Department of Customer Service (Australian state government department) – check out our case study
  • New South Wales Department of Premier and Cabinet (Australian state government department)
  • New South Wales Treasury (Australian state government department)
  • New South Wales Health (Australian state government department)
  • New Zealand Government Procurement (New Zealand government department)
  • New Zealand Inland Revenue (New Zealand government department) – check out our case study
If you’re looking at implementing eInvoicing, fill in the form below and we’ll get in touch with more information.

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E-invoicinggovernment

15/10/2020

Why finance needs to become friends with technology

Finance teams constantly find themselves battling things like:
  • a need to reduce costs
  • greater workload with the same amount of staff
  • manual processes, which often lead to errors and
  • disparate sources of data, making it hard to find information when they need it.
The good news is that technology can improve these issues. And that’s why finance needs to become friends with technology.

Here’s where technology can help

Automate your whole procurement process with electronic data interchange (EDI)

This can significantly improve the processes of ordering and invoicing for any finance team. So, what is it? Simply put, EDI is the exchange of business information directly between business software. Think of a purchase order being created in one company’s accounting package, and it ‘magically’ appearing in the supplier’s software. EDI can help:
  • Reduce manual processes EDI can ease a lot of pressure on finance teams that find themselves processing an increasing amount orders. You’ll no longer need to input data into multiple systems or email documents to buyers and suppliers. This leaves you more time to focus on the other tasks that might come up.
  • Reduce costs EDI reduces manual processes and significantly reduces the amount of labour needed to process orders. This is especially beneficial during peak times of the year where casual assistance can be required. On top of this, EDI is all digital so you can save a lot on printing and filing.
  • Reduce errors and improve data accuracy EDI also reduces the risk of errors, making the data more reliable for reporting. You could use that data to monitor suppliers’ performance around responding to orders or delivery times.

Remove manual handling of invoices with eInvoicing

Another bit of technology that can help finance teams is eInvoicing. Invoicing makes up a huge chunk of finance teams’ time. Electronic invoicing, or eInvoicing, enables organisations to send and receive invoices electronically, directly to and from their software. It removes the need for unnecessary data entry and inaccurate OCR scanning.

eInvoicing can:
  • Reduce manual processes eInvoicing automates a lot of the manual processes involved in invoicing. No need to input the invoice information into multiple software and attaching to an email before sending to the customer. Everything is done within your existing ERP or accounting software.
  • Reduce costs Reducing manual processes simplifies invoicing for any finance team leaving you more time to work on other tasks. It also helps reduce the need to additional staff cover during peak times. The sending and filing of these eInvoices are electronic reducing your paper use and filing costs.
  • Data accuracy Manual processing is reduced limiting the risk of errors and improving data accuracy. Fewer errors means fewer disputes with partners and the need to follow up or correct invoices.

Use the data from your automated processes for more

If you leverage technology, the likelihood is that you can now use the data at your fingertips in more in-depth, insightful ways.
  • Two-, three- or four-way matching Is your team manually checking orders before they pay invoices? This is something that can be completely automated. Two-way matching checks the quantity and price on the order and the invoice to make sure you’re paying for exactly what you ordered. Three-way matching also checks what was shipped (on a despatch advice). And the bee’s knees, four-way matching, checks what the suppliers has agreed to send from the order response.
  • Invoice reconciliation With a feed from your bank and visibility of your invoices, our technology can reconcile your invoices. Imagine the time that could save!
  • Reporting Now that all the raw data is at your fingertips, you can use it to report on anything. It might be DIFOT (delivered in full on time) performance, the amount of invoice discrepancies or something else. The options are only limited by your imagination.
If you’re interested learning more about how eInvoicing or EDI can help you, request a call from one of our EDI experts.

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E-invoicingEDIRetailersSuppliers

04/09/2020

When is the right time to implement eInvoicing?

eInvoicing lets companies exchange invoices electronically, directly to and from their software. It removes the need for unnecessary data entry and inaccurate OCR scanning. Businesses are increasingly adopting eInvoicing to:
  • reduce costs involved in processing invoices
  • process invoices faster
  • make faster payments
  • reduce data entry errors
  • move to a more secure way of exchanging invoices.
So when is the right time to implement eInvoicing? Here are some signs that it’s now time.

Your customers and suppliers are implementing eInvoicing

As businesses and government agencies enable eInvoicing, there’ll be a bigger push for their customers and suppliers to join them. Some organisations are providing incentives to make the transition more attractive. For example, government agencies here in Australia who can receive eInvoices have promised to pay them in five days for contracts up to $1 million. So, if you have multiple partners who are using eInvoicing, now might be the time to get on board. You’ll can start exchanging eInvoices with them, and future proof your investment by connecting with other customers and suppliers as they come on board.

Data entry is taking up too much time and resources

If you’re struggling to keep up with all your work, or if you’re looking to hire extra staff to help with invoice processing, it might be time to look at eInvoicing. Invoice processing can be time consuming for accounts payable and receivables teams because of the manual inputting, which is prone to errors. Processing a paper invoice is estimated to take 23 days, and that’s when the process runs smoothly. As a business processes more invoices, this can take even longer. eInvoicing is significantly streamlined and automated, reducing processing time. eInvoicing can reduce it by up to 65%.

You’re seeing too many data entry errors

Processing invoices manually or using OCR scanning can be error-prone. If you’re seeing a high error rate, it could be worth considering eInvoicing. The data is only input once – when the supplier inputs it into their software. And it’s no re-entry or scanning required – the source data is used all the way through the process. eInvoicing can reduce errors by 37% compared to manual invoicing.

You want to reduce costs

All businesses are looking for ways to reduce costs. One process that’s often forgotten is invoicing. Traditionally, costs attributed to invoicing can be:
  • Printing: even if you’re using PDFs, invoices may be printed. You’ll need to pay for paper, ink and even printer maintenance.
  • Labour: you need people to process invoices and this only increases as your business grows.
  • Filing: if you’re storing hard copies of your invoices, the costs can add up.
Overall, it’s estimated to cost $30.87 to process a paper invoice and $27.67 for PDF invoices. If you’re processing more and more invoices, these numbers start to add up. For suppliers, eInvoicing can:
  • reduce accounts receivable costs by up to 44%
  • reduce archiving costs by up to 32%
For buyers, it can:
  • reduce the cost of receiving an invoice by up to 90%
  • reduce the cost of archiving accounts payable invoices by up to 67%
  • cost less than $10 to process
  • reduce accounts payable labour by 25-40%.

You’re undertaking a digital transformation review

Businesses often look to digital transformation to improve business process and performance. The result of it should also provide more accurate data to help with analysis and decision making. Finance teams can realise fantastic benefits when they implement eInvoicing. eInvoicing can automate the invoicing process and significantly reduce manual inputting. This improves data accuracy for reporting and decision making, making it easier to see real-time liability position. The other great thing is that it works with your existing accounting software, so there’s no need for further investment.

Low cashflow

High competition in the business environment has led to an increase in credit sales, particularly in Australia. This has led to a high volume of suppliers struggling with cashflow. Economic downturns have added further pressure, so now more than ever, businesses are looking for ways to collect receivables as quickly as possible. eInvoicing helps to speeds up the time it takes to get to a customer. It also speeds up invoice processing and payment for buyers. Studies show eInvoicing can improve on-time payment by more than 15%. If you think it’s time for your business to implement eInvoicing, request a call from one of our EDI experts.

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E-invoicingRetailersSuppliers

04/09/2020

How to onboard suppliers to EDI: The key to maximising ROI

In tough times, like now for a lot of businesses, we scramble to find cost savings. We search for the lowest hanging fruit. Easy wins. The things that’ll give us the best bang for our buck. One thing to look at is automating your procure to pay processes. This is where electronic data interchange (EDI) can help.

What is EDI?

Simply put, EDI is the exchange of business information directly between business software. Think of a purchase order being created in one company’s accounting package, and it ‘magically’ appears in the supplier’s software; no email, no PDF, no manual data entry. Well, it’s not magic, it’s EDI! New to EDI? Learn the basics in our whitepaper, an introduction to EDI.

What are the benefits of EDI?

There are a few reasons why more and more businesses are shifting to EDI especially during tough times. These include:
  • cost savings
  • reduced errors
  • greater visibility into your supply chain
  • improved efficiency
  • automated processes
  • easier supplier reporting.

The key to EDI: getting your suppliers onboard

It all sounds fantastic, right? But it only works when your suppliers are onboard too. There are a couple of important reasons why:
  • It maximises your ROI Every business wants to make sure they’re getting the most out of their investment. The best way to do that with EDI is to ensure your suppliers are trading through the same method. The cost savings you’ll see from EDI are per supplier. The reduced savings you’ll see are per supplier. And it’s the same with the other benefits.
  • You use one process with all your suppliers Businesses that don’t onboard all their suppliers have different processes for each. All this does is stop your team from eliminating errors and saving time. This is especially the case when receiving invoices. If you still receive email and PDF invoices your accounts payable team still need to manually input the figures into your system

You’ll face pushback. But that’s ok!

Onboarding to EDI has long been an issue of contention between companies and their suppliers. We’ve seen it all; their systems aren’t capable, they don’t have the knowledge, they can’t meet your deadline or it’s too expensive. We haven’t been involved in one onboarding project where all suppliers get onboard without any pushback. But that’s ok…

Have options ready

That’s ok… As long as you have options. This is where it’s really important you have a great EDI provider. Their experience and tools in this space can help you overcome all of this.

Consider staging your onboarding

This’ll make it more manageable. Plus, you’ll learn as you go. You could segment by:
  • Those who you send the largest order volumes This’ll get you the some of the biggest benefit straight up.
  • Your most troublesome suppliers If you’re spending lots of time rectifying these mistakes, think about onboarding this group first.
  • Suppliers who can get going quickly, or who have experience in this area They’ll likely be able to get onboard fastest.
  • Or something else!
You can tackle each type of supplier within each of your stages. Each group will require a tailored communication so make sure it’s clear on what they need to do and by when. Once you’ve sent out your communications, you’ll need to do some testing. This will vary between suppliers using a portal and those who are integrated with their software.

Seek help

If you’ve chosen the right EDI provider, they’ll be able to help you and call on their experience to get your suppliers onboard. If you’re interested in learning more about onboarding your suppliers to EDI, check out our free webinar!

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EDIRetailers

04/08/2020

What are my eInvoicing options?

eInvoicing is changing the way we send invoices and other documents to our partners. Simply put, eInvoicing enables organisations to send and receive invoices electronically, directly to and from their software. It removes the need for unnecessary data entry and inaccurate OCR scanning. eInvoicing happens through a four-corner model, where corners one and four are the supplier and customer, and corners two and three are Access Points. Access Points connect to each other to exchange eInvoices. You can think of it like a telephone network – your phone and your friend’s phone are corners one and four, and your network provider (like Telstra, Optus or Vodafone) are corners two and three.We’re seeing eInvoicing rapidly expand around the world, especially in government agencies. In Australia, the government has promised to pay suppliers with contracts less than $1 million in 5 days if they issue eInvoices. It can be difficult for suppliers to decide what’s best for their business. Here are some of the eInvoicing options you have as a supplier.

What are my options

Portal based eInvoicing

This option is the fastest to implement and has the least up-font costs. You can enter your eInvoices in a website and send them to your customer via the Peppol eInvoicing network. These are then received into your customer’s software.

MessageXchange offers businesses a free portal, Colladium, which can be used to send eInvoices to businesses on the Peppol network.

There are a few benefits of using portal-based eInvoicing:
  • It’s easy to set up
  • There’s generally no establishment fee and low to zero monthly costs
  • It can be accessed anywhere – you only need an internet connection
  • They often have an easy-to-use interface.

eInvoicing integration/gateway

The more automated option is an eInvoicing gateway or integration. This allows you to send and receive eInvoices directly from your ERP or accounting software. This means you don’t need to do any additional manual processes. Once you’ve entered the invoice in your existing software, it’s then sent to your customer’s software for them to process. There are a number of benefits to an integrated eInvoicing solution:
  • It uses your existing software
  • You can find cost savings (paper, printing and labour costs)
  • There’s no need for data re-entry
  • You’ll see fewer errors
  • It’s secure through encryption at rest and in transit.

What are my options

It’s important to choose an option that is adaptable and flexible for your business. Two of the main factors to consider are:
  • The amount of orders you receive As your orders increase, so does the amount of manual inputting.
  • Your strategic goals Whether you’re looking to automate your processes or just comply with your buyers eInvoicing requirements or incentives.
Use this table as a rough guide:[vc_column_inner width="1/2" css=".vc_custom_1565317545162{padding-top: 0px !important;background-color: #00b7f1 !important;}"]

Consider portal based eInvoicing if…

[vc_column_inner width="1/2" css=".vc_custom_1565315132956{padding-top: 0px !important;padding-bottom: 0px !important;background-color: #1b75bb !important;}"]

Consider an eInvoicing gateway if…

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You issue a small number of invoices a month

[vc_column_inner width="1/2" css=".vc_custom_1565317619229{padding-top: 0px !important;padding-bottom: 0px !important;background-color: #eeeeee !important;}"]

You issue a large number of invoices a month

[vc_column_inner width="1/2" css=".vc_custom_1565317604253{padding-top: 0px !important;background-color: #eeeeee !important;}"]

You have a small amount of eInvoicing enabled customers

[vc_column_inner width="1/2" css=".vc_custom_1565317619229{padding-top: 0px !important;padding-bottom: 0px !important;background-color: #eeeeee !important;}"]

You have large amount of eInvoicing enabled customers

[vc_column_inner width="1/2" css=".vc_custom_1565317604253{padding-top: 0px !important;background-color: #eeeeee !important;}"]

You just want to comply with a handful of buyers’ requirements

[vc_column_inner width="1/2" css=".vc_custom_1565317619229{padding-top: 0px !important;padding-bottom: 0px !important;background-color: #eeeeee !important;}"]

You don’t want to double-enter data

[vc_column_inner width="1/2" css=".vc_custom_1565317604253{padding-top: 0px !important;background-color: #eeeeee !important;}"]

You’re just starting out in eInvoicing

[vc_column_inner width="1/2" css=".vc_custom_1565317619229{padding-top: 0px !important;padding-bottom: 0px !important;background-color: #eeeeee !important;}"]

You need a flexible solution that grows as your business does

[vc_column_inner width="1/2" css=".vc_custom_1595395392804{padding-top: 0px !important;background-color: #ffffff !important;}"][vc_column_inner width="1/2" css=".vc_custom_1565317619229{padding-top: 0px !important;padding-bottom: 0px !important;background-color: #eeeeee !important;}"]

You want to reduce errors

If you’re interested in learning more about eInvoicing options, fill in the form below and one of our experts will get in touch.

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E-invoicing

23/07/2020

3 reports retailers need

A real benefit that’s often forgotten when it comes to electronic data interchange (EDI) is improved reporting. We all know that EDI reduces the amount of data entry errors, but not as many people leverage that data for reporting. EDI allows you to get accurate insights to make informed, data-driven business decisions. From tracking the performance of your suppliers to seeing how many orders you’ve sent, we’ve picked three reports all retailers should be using.

Purchase orders with outstanding invoices

EDI feeds invoices directly into your software so you can easily identify which ones are yet to be paid. This data’s important to keep track of a business’ liabilities and financial position. Keeping on top of outstanding invoices will improve your business liquidity and help maintain positive relationships with suppliers.

Order to shipment lag and order fulfillment rate

Advanced shipping notices (ASNs) are sent through EDI when goods are shipped. They let the buyer know what’s sent, when and how. It’s easy to grab this data from EDI messages to measure the amount of time between a purchase order being issued and the goods being shipped, as well as how much of the order has been fulfilled. This data can be used by retailers to measure supplier fulfillment rates, so you know your in-stock position. It’ll also make it easier for you to identify trends in a company’s ability to supply goods.

Purchase order date to receipt of goods date

Having an understanding how long it takes between placing an order and goods being received is imperative for retailers. The good news is retailers can easily track this metric from the data in EDI messages (like receiving an ASN and scanning SSCC labels as goods come in) to monitor supplier delivery in full on time (DIFOT) performance and optimise order management and stock levels. If you’re interested in improving visibility and gaining valuable insights, request a call from one of our EDI experts.

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EDIRetailers

08/07/2020

Two-, three- and four-way matching: Made easier with EDI

Paying invoices can be a time-consuming task, especially for retailers who pay tens of thousands of invoices a month. Before payments are made, they need to check the goods have been received and the price and quantities on the invoice are accurate. The last thing they want is to be paying for things they shouldn’t be. But sometimes mistakes happen. They can be a result of human error like data entry mistakes. Or it could be something more sinister. The accounts payable team usually compares the quantity and price on an invoice against the purchase order, as well as the stock that’s been received. Unfortunately, the more checks that are done, the more time consuming the process is. That’s where EDI can help.

What is two-way, three-way and four-way matching?

It’s where the accounts payable team checks the quantity and price of an invoice against what’s been ordered and agreed to, and what’s been received. The number of documents checked determines the type of matching (eg. two documents = two-way matching and so on). So what documents are checked?[vc_column_inner width="2/6" css=".vc_custom_1593754872084{padding-top: 20px !important;padding-right: 0px !important;padding-bottom: 20px !important;padding-left: 0px !important;}"][vc_column_inner width="1/6" css=".vc_custom_1593753592414{padding-top: 20px !important;padding-right: 0px !important;padding-left: 0px !important;background-color: #1b75bb !important;}"]

Two-way matching

[vc_column_inner width="1/6" css=".vc_custom_1593753600250{padding-top: 20px !important;padding-right: 0px !important;padding-left: 0px !important;background-color: #1b75bb !important;}"]

Three-way matching

[vc_column_inner width="1/6" css=".vc_custom_1593753606451{padding-top: 20px !important;padding-right: 0px !important;padding-left: 0px !important;background-color: #1b75bb !important;}"]

Four-way matching

[vc_column_inner width="1/6"][vc_column_inner width="2/6"]

Purchase Order (Check price and Qty)

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Order Acceptance/Response (Check Qty)

[vc_column_inner width="1/6" css=".vc_custom_1593753317822{padding-top: 20px !important;background-color: #f9f9f9 !important;}"][vc_column_inner width="1/6" css=".vc_custom_1593753325484{padding-top: 20px !important;background-color: #f9f9f9 !important;}"][vc_column_inner width="1/6" css=".vc_custom_1593753338153{padding-top: 20px !important;background-color: #f9f9f9 !important;}"][vc_column_inner width="1/6"][vc_column_inner width="2/6"]

Order Receipts and Packaging Slips (Check Qty)

[vc_column_inner width="1/6" css=".vc_custom_1593753317822{padding-top: 20px !important;background-color: #f9f9f9 !important;}"][vc_column_inner width="1/6" css=".vc_custom_1593753325484{padding-top: 20px !important;background-color: #f9f9f9 !important;}"][vc_column_inner width="1/6" css=".vc_custom_1593753338153{padding-top: 20px !important;background-color: #f9f9f9 !important;}"][vc_column_inner width="1/6"][vc_column_inner width="2/6"]

Invoice (Check price and Qty)

[vc_column_inner width="1/6" css=".vc_custom_1593753317822{padding-top: 20px !important;background-color: #f9f9f9 !important;}"][vc_column_inner width="1/6" css=".vc_custom_1593753325484{padding-top: 20px !important;background-color: #f9f9f9 !important;}"][vc_column_inner width="1/6" css=".vc_custom_1593753338153{padding-top: 20px !important;background-color: #f9f9f9 !important;}"][vc_column_inner width="1/6"]And why do businesses choose to use two-, three- or four-way matching?
  • It saves money It helps businesses avoid overpaying for items, paying for duplicate items and paying for things they haven’t received.
  • It safeguards the business By checking the audit trail, it decreases the risk of paying fraudulent or incorrect invoices.
  • It helps you pinpoint trouble suppliers Verifying invoice amounts and price can help make sure your suppliers are not taking advantage of you. Suppliers who consistently make mistakes on invoices can cost your business and could be a sign to look for alternatives.
  • Prepares businesses for audits Auditors are specifically on the lookout for financial discrepancies. Compiling these documents in advance of an audit and checking that the numbers line up using the three-way matching process is a big step in the right direction.

How can EDI be used with two-, three- or four-way matching?

EDI (electronic data interchange) is the exchange of business information directly between business software. Think of a purchase order being created in one company’s accounting package, and it ‘magically’ appears in the supplier’s software; no email, no PDF, no manual data entry. Well, it’s not magic, it’s EDI! So how does EDI work with verifying invoices? EDI gets all the data you need in your software – purchase orders, purchase order responses, shipping notices and invoices. It doesn’t require a person to type them in, they just appear. Once all the documents are received, a workflow can match each invoice with the corresponding purchase order, purchase order response and shipping documents. It’ll automatically check that the invoice price is what was agreed on, and the invoice quantity is not more than the amount of stock you received. It saves your accounts payable team time by automating the process. The benefits of using EDI with two-, three- or four-way matching are:
  • automated document matching
  • reduced time to make payments
  • reduced labour costs
  • more time for your accounts payable team to work on value-adding tasks
  • less human errors.

Implementing two-, three- or four-way matching

There are few things to think about before you start using two-, three- or four-way matching in your business.

Decide what you want to achieve

You can take verification to different levels of details, these could be:
  • Making sure you’re not paying for more than you ordered
  • Making sure you’ve received what you’re paying for
  • Or something else.
This will determine what level of matching is best to achieve your goals.

Decide what messages and fields to match

Depending on what you want to achieve will determine what messages and data you’ll compare: Two-way matching You’ll probably match:
  • the price in the purchase order (PO) with the price on the invoice and
  • the quantity in the purchase order with the quantity on the invoice.
Three-way matching In addition to the checks in two-way matching, you’ll probably match:
  • the quantity of the goods shipped by the supplier.
This information can be found on the advanced shipping notice (ASN) or despatch advice. Four-way matching In addition to the checks in three-way matching, you’ll probably match:
  • the quantity of the goods confirmed from your supplier. This information can be found in the purchase order response (POR), which you can ask your suppliers to send to you through EDI.

Decide what messages and fields to match

Once you know what messages you will be using you can get started with implementing EDI. Working with an EDI provider The first thing is choosing an EDI provider, check out our blog to learn more about what to think about. After that, your EDI provider will build out your business rules to automate the checking of EDI messages. When your business rules are set to your requirements then you are able to go live. Onboarding your suppliers Suppliers can only start sending you messages (i.e. POs, invoices, ASNs and/or PORs) once you have onboarded them.
  • Your EDI provider can easily connect to suppliers that already have EDI capability.
  • For the suppliers who aren’t EDI compatible, it may be worth providing them with a portal option to start sending messages quickly and easily to you. For MessageXchange customers, we offer a free portal, Colladium, to help onboard suppliers.
If you’re interested in learning more about two-way, three-way or four-way matching, fill in the form below and one of our experts will get in touch.

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EDIRetailers

26/06/2020

The benefits of eInvoicing for businesses: An infographic

eInvoicing automates the exchange of invoices directly between businesses’ software and its use is growing across the globe as a result of the benefits it brings. Australia and New Zealand have joined forces to to make trans-tasman eInvoicing easier using the internationally-adopted Peppol eInvoicing framework. Any business within this network can now send and receive invoices straight from their accounting software to their customer's software. No more emails, no more PDFs and no more manual data entry. If you're new to eInvoicing, check out our blog, traditional invoicing and eInvoicing: a comparison. Here are just some of the reasons businesses are turning to eInvoicing.

For buyers

A major benefit for those receiving eInvoices comes from the fact you'll no longer have to manually enter an invoice again. Think of the time savings and the mis-keying errors that'd disappear. Here are some stats:

For suppliers

A major benefit of eInvoicing is the speed of it. It can ultimately lead to faster payments, which means better cash flow for you. Let's have a look:

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E-invoicingRetailersSuppliers

15/05/2020

5 ways to make savings in your business when times get tough

A lot of us have had a chuckle at this meme:But it’s no joke. It’s times like these that often spur us into action. Whether you’re looking for ways to overcome the current economic downturn, prepare for the next one or you’re just looking for ways to reduce costs, have a look at these five things you can do to make savings:

Automate your supply chain

If you’re still emailing orders and invoices, you’re probably doing more data entry than you need. It might look like this:
  1. Buyer manually enter purchase order in their software.
  2. Buyer send order to supplier via email or post.
  3. Supplier receives order and manually enters the purchase order details into their software.
  4. Supplier manually enters the invoice into their software.
  5. Supplier send invoice to buyer via email.
  6. Buyer manually enters the invoice in their software.
This is where EDI can help. EDI connects your software with the software of your partners, automating most of the process. Here’s the difference:
  1. The buyer enters the purchase order in their software.
  2. It’s automatically sent to the supplier and appears in their software.
  3. The supplier actions the PO and then creates the invoice in their software and sends back to the buyer.
  4. The invoice then appears in buyer’s software.
This can save your staff a lot of time, allowing them to work on more high value tasks. It helps suppliers process and send invoices faster, which can improve cash flow. For buyers, invoices can be processed faster and some suppliers even offer discounts for early payments. The automation from EDI can also generate significant cost savings for businesses. Manual data entry errors and the costs associated with fixing them are also reduced through automation. Suppliers can send shipment information through EDI, allowing buyers to prepare in advance and better allocate their warehouse staff and resources. This can reduce receiving costs, particularly labour, for buyers. Check out our blog for more information.

Automate your accounts payable

Often errors are made by incorrectly entering invoice data. Not only does it stop staff from working on higher value tasks, but it can be costly to rectify the errors. EDI makes it easy to implement two- or three-way matching. Two-way matching involves automating the process of checking invoice quantities and values against that on the purchase order. Three-way matching goes one step further and also checks delivery information to verify the invoice is for the same quantity that’s been sent. It not only saves your team time, but can also reduce labour costs.

eInvoicing

eInvoicing allows you to send invoices directly from your software to your partners’. It uses the international Peppol standard to send and receive eInvoices. It’s different from EDI in that you only need to connect to the Peppol network through an Access Point to you can exchange eInvoices with anyone else in the network. eInvoicing produces savings by:
  • Reducing the amount of work required send invoices. This reduces costs and allows your accounts receivables teams to focus on value adding activities.
  • Helping increase cash flow for suppliers by speeding up the preparation and sending of invoices.
  • Helping buyers speed up their payment processing, allowing them to make good on early payment discounts.
Want to learn more about eInvoicing? Check out this blog.

Automate goods receipt

Receiving goods from suppliers can be a time-consuming process. It can be difficult to know when goods will arrive and therefore can be difficult to plan. This only wastes time, money and resources. A way to make savings in this area is to ask suppliers to send you advanced shipping notices (ASNs) directly to your software through EDI. ASNs detail what your supplier is sending, how it’s packed, when it’ll arrive and more. This allows you to prepare to have the right warehouse staff to receive the shipment, saving you money on labour and allowing you to allocate staff more efficiently. Receiving ASNs from suppliers will also allow you to automatically record stock as it comes in. SSCC labels (the barcodes on each unit your supplier sends) correlate to a unit (e.g. a box or container) on the ASN. Scanning each pack as it comes in reduces manual inputting, saving your warehouse team time and reducing the risk of costly inputting errors. It also means your stock levels will always be up-to-date.

Consider alternative models with suppliers

A large cost for retailers can be for warehousing and logistics and that’s why savvy retailers are turning to drop shipping. The drop shipping model sees the supplier hold stock. When the retailer makes the sale, they pass the details onto the supplier to ship the order to the customer. EDI can create even more efficiency in this model by:
  • Sending orders directly to suppliers when the order is placed
  • Reducing errors and the related costs
  • Keeping you updated on suppliers’ stock levels, helping you avoid shortages of goods.

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E-invoicingEDIRetailersSuppliers

15/05/2020

Why are retailers moving to drop shipping and EDI?

Increased pressure for high margins has made more retailers look to alternative business models. One of these is drop-shipping. Retailers are moving away from just physical stores and warehouses to drop shipping. This is often coupled with e-commerce stores. As retailers adopt drop-shipping, they’re also starting to look at ways to make fulfilment fast and accurate. This is where EDI comes in.

What is drop shipping?

Drop-shipping involves retailers asking their suppliers to ship products directly to the customer. This means the retailer doesn’t have to invest in warehousing and logistics. The process typically looks like this:
  1. The customer places an order
  2. The retailer sends that order to the supplier
  3. The supplier prepares order
  4. The supplier ships the goods to the customer
There are a number of benefits of drop-shipping for retailers:
  • It’s easier to get started It can be as simple as setting up an ecommerce website and sending orders to your suppliers.
  • It lowers costs and capital investment There’s no need to hold excess stock so overheads are reduced. Logistics costs are also reduced or eliminated.
  • It allows you to sell a wider selection of products You don’t have to hold stock, so you can sell as many product lines as you like. And there’s no limitation on how many suppliers you work with.
  • It’s easier to scale your business As your business grows, you don’t need to think about increasing your store locations. Your costs vary according to the orders you make. This significantly reduces risk for your business as your fixed costs are reduced.

Why use EDI with drop-shipping?

Automate ordering processes

Drop shipping can bring a lot of benefits for retailers but it’s only successful if it’s done efficiently. Retailers typically need to submit orders through a supplier portal or by email or post. It’s time consuming and can cause errors, leading to slower delivery times and low customer satisfaction. But EDI can automate the ordering process. Retailers can send orders directly to suppliers’ software from their software, reducing the time to get the orders out, as well as costs.

Real-time visibility of orders

Another issue manual drop-shipping can present is a lack of visibility. Retailers can receive little to no information once they place an order – they’re often in the dark about the status, including whether the order has been sent to the customer. With EDI, suppliers can send advanced shipping notices or despatch advices to let retailers know when an order is being shipped. This often includes tracking numbers and other shipment information, which the retailer can use to update their customer.

Visibility of suppliers’ stock

With drop-shipping, retailers don't need to hold the inventory themselves, so it’s important to keep tabs on suppliers’ stock levels. Having no visibility of it can lead to long delivery times or even having to let a customer know that the item is no longer available. Using EDI, retailers can request suppliers’ stock levels so they always know what’s available.

How to get started

There are a few steps to go through to get set up with drop-shipping and EDI. You’ll probably have existing relationships with your suppliers, so your next steps might be to:
  1. Establish a drop-shopping arrangement with your suppliers Work with your existing suppliers to see which ones are willing to enter drop-shipping arrangements. You can also discuss the opportunity with new suppliers who can add a wider range of products to your offering.
  2. Move to EDI integration with your suppliers Speak to an EDI provider, like MessageXchange, to get you connected to your suppliers. EDI providers have different experience and pricing so it's important to review all your options. Check out our blog for things to think about when looking at EDI providers.
  3. Test connectivity and messaging Once you've chosen your provider you'll need to test the connectivity and messaging to make sure everything is working correctly. You'll also need to test with your suppliers to make sure they can send and receive messages correctly. Check out our message compliance testing (MCT) tool for fast and accurate supplier onboarding.
  4. Go live! You're ready to get started and start selling!

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EDIRetailers

08/05/2020

Portal to integration: Why switch?

Suppliers have two main ways to comply with their retailers’ EDI requirements: EDI webforms (web portal-based EDI) or integrated EDI. Portal or web-based EDI is often the go-to choice for suppliers just starting out. EDI web portals They’re usually easy to setup and simply use a web browser to send messages to your retailers. The process normally looks like this:
  1. You receive the order to your EDI portal
  2. You send the order details to your warehouse team to prepare order
  3. You then manually enter the purchase order response (this lets the retailer know what you can fulfill)
  4. Once the order is finalised, your warehouse team prepares the advance shipping notice (ASN – this lets the retailer know what’s being shipped, how and when)
  5. You send the information to your accounts receivable team
  6. Your accounts receivable team input the information into their software to prepare the invoice.
If you receive a lot of orders, this process requires a lot of manual inputting, which is time consuming and error-prone. Integrated EDI Integrated EDI simplifies this process through automation, eliminating manual reinputting.
  1. You receive the order in your existing software automatically which you can send to your warehouse team. If you have a warehouse management system (WMS) and integrate it to your ERP software then the order can be automatically sent to your warehouse team.
  2. Once your warehouse team check your inventory, you can then send a purchase order response (POR) back to the retailer. The POR is prepared using the existing information from the original order. You can also automate the sending of the POR by integrating your WMS with your ERP software to send PORs without inputting anything.
  3. You then manually enter the purchase order response (this lets the retailer know what you can fulfill)
  4. Once the order is prepared and ready for shipping, you can then send an ASN to the retailer. If you use an WMS, you can integrate with your ERP and automate the creating and sending of the ASN. An invoice will then be automatically sent to the retailer using the information from the POR.

Why do suppliers switch to integrated EDI?

There are a number of reasons why business switch to EDI:
  • You can use your existing software
  • There’s no need for data re-entry
  • You can automate manual processes
  • It improves data accuracy
  • It helps with faster order processing.

Making the decision: EDI web portal or integrated EDI?

There are a few factors to look at when deciding if integrated EDI is best for you, including:
  • The amount of orders you receive, the number of products you sell and the amount of information that is required from your customers As these factors increase, so does the amount of manual inputting you will be required to input into each form.
  • The functionality of your software For example, if your retailers require an advanced shipping notice with SSCC labels. Can your software produce these? We go through this a bit further in this blog.
  • Your strategic goals For example, if you want to integrate with other systems or automate other business processes.
Use these points as a rough guide to know when to consider integrated EDI.
  • You trade with a large number of retailers
  • You receive more than roughly 30 orders a week
  • You sell a large range of products
  • Your customers require a substantial amount of information
  • You want automated processes
  • You don’t want to double-enter data
  • You need a flexible solution that grows as your business does

How to get started

There are a few things you can do to prepare for the switch to integrated EDI.

Who should be involved?

To get buy in from your business you’ll need to get relevant departments involved. These include:
Management
Often will be the first you need to get involved. Make sure to calculate your cost savings and ROI with your current:
  • costs of processing orders
  • costs of rectifying order mistakes
  • costs of resolving disputed/returned shipments
  • costs of producing invoices
  • costs of resolving disputed invoices.
For more information on calculating costing savings and ROI check out our whitepaper.
Information Technology
To get buy in from your IT team, you should think about these things:
  • Will they need to buy or install any new hardware or software? Some solutions require new hardware or software to be installed. Here at MessageXchange, we don’t require our customers to install any new hardware or software. We simply connect to your existing software.
  • Will they need additional resources to implement EDI? This is dependent on the EDI solution you use. With our technology, your software only needs the ability to import and export messages and exchange them via a secure connection protocol. Check with your IT team whether they can currently do this. If not, what resources will they need?
  • Does the provider adhere to your security policy? IT teams are often aware of security risks to your internal systems. Put their mind at ease by showing what measures your EDI provider takes to keep your data secure. MessageXchange is ISO 27001 certified and having developed the software from inception, owns its intellectual property.
Finance
Another department that’s processes are influenced by EDI is finance. It’s important to not only show the savings EDI can make for the business but also the reduction in manual processing, leading to:
  • improved efficiency, allowing staff to work on higher value tasks
  • fewer errors: less time and costs to fix mistakes
  • reduced costs: no need to printing and archive paper invoices.
  • more accurate data for decision making.

The nitty gritty

Before implementing integrated EDI, you’ll need to think about these things: Who are you trading with and what messages do you need to exchange? Retailers will often send you information packs to get you started with EDI that will include the messages they need you to exchange. It could be purchase orders, purchase order responses, advanced shipping notices, invoices and more. Ask your retailer or speak to your EDI provider if you don’t know what’s required. Next, you’ll need to know the file format you’re required to exchange: This is likely to be EDIFACT D01B or D96A or XML. If you don’t know what your retailer is expecting, have a chat to your contact there or your EDI provider. You’ll also need to find out what your software is capable of, in relation to:
  • The documents your software can use. For example, if your customer requires an advanced shipping notice and SSCC labels does your software support that?
  • The file formats it can import and export, like XML or CSV.
  • The connection protocols it accepts, like sFTP or API.

Our process

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