MessageXchange interview series: The technical side of implementing eInvoicing with eInvoicing knowledge bank, Luke Zahra

It can be easy to overlook the technical requirements of eInvoicing and focus more on benefits. To get all the insights on the technical aspects of eInvoicing, we had a conversation with our eInvoicing knowledge bank, Luke Zahra.

Q: When putting together a project team, who should be involved, particularly on the technical side?

Luke:
  • ERP Consultant/Systems Expert
  • Accounts Payable/Accounts Receivable team
  • Implementation Team/Integration Specialists
  • Business Analyst
  • Project Manager

Q: Are there certain software specifications needed to implement eInvoicing?

Luke: No specific software specifications are required. As long as there is a way to extract or ingest eInvoice documents from your system, we can accommodate the implementation. We can work with your current software to ensure it integrates seamlessly with the eInvoicing process, including translating to the required formats if needed.

Q: What if your software doesn't currently export the UBL file format or use the fields set out in PINT A-NZ specifications, can you still implement eInvoicing with your existing software?

Luke: Just for those who are new to eInvoicing, PINT A-NZ specify the fields that are used in each document, like the eInvoice. The specifications are designed to be standard for most invoices generated by accounting and ERP systems. If your current software does not fully meet these specifications, we can work with your existing invoice format and provide guidance on adjustments needed to comply with the PINT A-NZ standards. This ensures that your invoices can be successfully translated into the UBL PEPPOL format for eInvoicing.

Q: Are there other message types I can utilise within the Peppol network besides eInvoices?

Luke: The main message types outside of the eInvoice are:
  • Credit Note
  • Invoice Response: informs the Seller when their invoice has been approved or payment has been initiated
  • Message Level Response: Lets the sender know whether the eInvoice has been received correctly by the receiver. These messages also detail what went wrong through specific syntax errors.
Peppol has other procurement messages in their specifications, but they're not yet widely used in Australia or New Zealand.

Q: What are the top three questions you get asked the most during the implementation process?

Luke: Clients often seek guidance on how the Peppol four-corner model works, including the roles of access points, and how data is transmitted between different parties. Clients often seek advice on the specific standards and best practices for eInvoicing in Australia and New Zealand. This includes knowing which fields are important when sending eInvoices to customers and understanding which fields to expect on incoming eInvoices from suppliers. Clients needing advice on which documents (e.g., invoices, credit notes, invoice responses) to implement in their eInvoice process and the best way to integrate these documents within their existing systems.

Q: What advice would you suggest to organisations implementing eInvoicing?

Luke: Start by evaluating your current invoicing processes and identify areas for improvement. While eInvoicing offers a streamlined and efficient approach, it’s important to understand how it will integrate with your existing procedures and address any manual complexities that may arise. Engage with your accounts payable and accounts receivable teams to ensure a smooth transition. Be aware of mandatory requirements for receiving invoices. If your business has specific rules that go beyond the standard PINT A-NZ specifications, these may need to be implemented using an Invoice Response document. This document allows you to block accounts payable eInvoices that do not meet your specific requirements.Want to learn more about getting your business ready for eInvoicing? Fill in the form below to get in touch with our experts.

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MessageXchange interview series: Getting started with EDI retailer requirements with our EDI specialist, Ellen Tjahjana

Getting started with retailer EDI requirements can be a daunting task. This month, we sat down with Ellen Tjahjana, our EDI specialist who’s worked with many of our EDI customers, to get her insights on starting out with onboarding to EDI.

Q: What are the first things to do when a retailer asks suppliers to comply with their EDI requirements?

Firstly, don't panic. It can seem overwhelming, especially if it's the first time you've been asked, and knowing it's something technical. Our team deal with this all the time and are used to helping suppliers through the process, so we can explain it to you in simple terms, and look after the technical parts for you. I would decide which EDI option is best for you - either a web portal or a fully integrated solution. In short, a web portal is good if you don't receive many orders or if your software can't handle all the EDI messages. For example, MYOB Business and Xero don't support advanced shipping notices. The other option is an EDI Gateway, or EDI that is integrated with your software - typically your ERP software. This means orders will land straight into your software and you action everything from there. The messages you generate in your ERP software, like a response to an order, a shipping notice and an invoice, will go via your EDI provider, to your customer. We've got some good resources on helping you choose an EDI option here. We actually even have some suppliers using a hybrid solution of webforms and integration with their ERP software. So if you think just one solution alone won't help, have a chat to your EDI provider to see if they have a solution for your unique setup. Another things we do fairly often is bring the supplier's 3PL into the process. We can send them a pick request when an order comes in so they can despatch the goods, and even get the ASN from the 3PL to pass back to the retailer. We've implemented a number of different setups, because we know not all businesses operate in the same way. Once you've decided on the right option for you, do some research on the providers and get in touch. Lean on your provider to help you through the process, especially if this is new for you.

Q: Who should suppliers get involved in their EDI project?

This somewhat depends on the option you've chosen. If you're going down the path of EDI webforms, make sure you get the people who will action the orders involved. This could be your accounts receivables team, your warehouse team - anyone who needs to do something in the process. Make sure they understand how to use the product so when you start receiving real orders, they're not slowed down by any learning curve. If you've chosen an integrated EDI solution, you'll often need to get your IT team involved. Sometimes this might be a consultant. And also get those who will action the orders involved. Their processes may not change all that much, but it's good for them to have some background on what happens behind the scenes, in case anything happens.

Q: What should suppliers look for in an EDI solution?

This somewhat depends on the option you've chosen. If you're going down the path of EDI webforms, make sure you get the people who will action the orders involved. This could be your accounts receivables team, your warehouse team - anyone who needs to do something in the process. Make sure they understand how to use the product so when you start receiving real orders, they're not slowed down by any learning curve. Experience is obviously a big factor too. It can help to choose an EDI provider who has connected to your retailer(s) before and are familiar with that retailer's EDI processes. If you're brand new to EDI or don't have much confidence, I'd definitely recommend choose and EDI provider that is willing to help you through the process and 'translate' any technical speak into plain English. Finally, obviously price is a factor, as well as the support they can offer you once your solution goes live.

Q: What are some places to get more information and to learn more about EDI?

We've got some good resources available on our website. For those who are new to EDI, this whitepaper explains, in simple terms, what it is. For those trying to choose which option is best for them, this blog can really help. And finally, we're always happy to speak to suppliers who are just starting out, or even those who aren't new to EDI. So feel free to pick up the phone to us or send us an email.

Q: What other advice would you give suppliers who need to comply with retailer EDI requirements?

I'm going to sound like a bit of a broken record, but I really do suggest you lean on your EDI provider. They're likely to have been through this process many times before and I know we're very happy to explain things and help our customers through the process. Don't be afraid to ask them questions, regardless of how silly you think they might be.Want to go through your EDI requirements with an experts? Getting in touch with us below.

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MessageXchange interview series: eInvoicing implementation tips and experiences with resident eInvoicing expert, Andriy Tyshchuk

With our experience in eInvoicing and other B2B integration, we’ve seen firsthand what customers have found useful, particularly during planning and implementation. So who better to ask for advice than our resident eInvoicing expert, Andriy Tyshchuk, who has years of experience in B2B integration, both from the end-user perspective and the service provider side.

Q: What benefits do customers get from eInvoicing?

Andriy: Customers are seeing the typical benefits that you often hear about when it comes to eInvoicing. Suppliers are seeing faster payment and improved cash flow, fewer disputes and rejected invoices and better relationships with customers. Buyers are seeing more automation, reduced invoice processing costs and less paper usage.

Q: Do any stages in the eInvoicing implementation process stand out and why?

Andriy: At the moment, one stage stands out more than others: onboarding customers and suppliers. eInvoicing is growing but it can be challenging to plan the onboarding process. Making sure you are segmenting your partners and communicating to each is key. Providing incentives, particularly faster payment times, for suppliers who send eInvoices can definitely help.

Q: How are businesses choosing an eInvoicing service provider?

Andriy: There are a few things customers seem to look for in an eInvoicing service provider. A key one is experience, particularly having a thorough understanding of the software they use, file formats and connection types they use, and having had success with them. We’ve worked with many software packages, but heavily with SAP, Oracle and Technology One.

Having localised and tailored support that can cater to their needs, as well as being competitive on price have been other factors. And we also see customers choosing based on word of mouth and reputation in the industry.

Q: What do we need from businesses to get them started?

Andriy: The process is very quick and easy for implementing eInvoicing. We just need to know what software you use, the file formats your software uses, and the connection type – how your software can connect to us. And we also need to know if they require us to implement any business rules to check specific information on invoices and automate approval and payment processes.

Q: What advice do you have for organisations currently looking to implement eInvoicing?

Andriy: Plan ahead with all the information required to get started. For buyers receiving invoices, make sure you know your connection protocols, file format and business rules. Certain ERP requirements may be needed, so we need to look at how that data can be obtained from the supplier’s software or whether we find other ways to populate the information needed. I’d also use our ‘matchmaking’ service to see which of your trading partners are already sending eInvoices and could be ‘low hanging fruit’ to onboard.Want to learn more about getting your business ready for eInvoicing? Fill in the form below to get in touch with our experts.

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MessageXchange interview series: What to think about before implementing EDI with resident EDI expert, Kieren James

Here at MessageXchange, we’ve been in the EDI game for a while now. We recently sat down with Kieren James, one of our resident EDI experts who’s worked with many of our EDI customers, to get some insights into why businesses implement EDI, what to think about when doing so, some of the challenges businesses face when implementing and his top tips for success.

Q: Why do companies implement EDI?

Kieren: I used to see companies use EDI to reduce their costs and manual processes, or to comply with their retailers’ EDI requirements. But now I’m seeing the balance shift to be more about seeking efficiency in processes. Businesses with more efficient process can get a better competitive advantage and differentiate themselves from competitors.

Q: What advice do you have for businesses implementing EDI?

Kieren: Internal planning is more important than ever. It’s key to remember that not all software is the same, especially when it comes to the fields, or data, your software supports. Doing a gap analysis before you start your implementation is super important. Your consultant, if you’re using one, can sometimes miss fields that are required. For example, you might run into problems if your software can’t send certain information like the unit of measure. As a supplier, it’s a good idea to check out your customers' message integration Guides (MIGs) to make sure your software can handle all the required fields.

Q: What do you see as customers’ biggest challenge when implementing EDI?

Kieren: There are a few key challenges customer face when implementing EDI. Some that come to mind are:

  • Not providing enough resources to allocate to the EDI project
  • Not checking message requirements and seeing if you’re current setup can populate the required fields.
  • Lack of EDI knowledge and understanding. A great way around this is to look at resources on EDI, like some of our whitepapers and blogs. Also, getting people who know about EDI in your EDI project team can be a real benefit. Another thing is to make sure you use the experience and knowledge of your EDI provider to get the most out of your EDI solution.

Q: How do businesses usually chose an EDI service provider?

Kieren: We get a lot of customers coming to us through recommendations – word of mouth between customers and their suppliers is a big one. Customers also want a provider that are familiar with the requirements of their trading partners. They also want an EDI provider that has the experience in the field that can provide support to them.

Cost is another important factor, particularly in the long term. Customers want transparency in terms of pricing, so we will clearly show how we have calculated any estimated costs and make sure we easily explain our pricing structure.

Q: What benefits have you seen from customers using EDI?

Kieren: Automation is the key benefit when implementing EDI. We’ve had customers with a haphazard approach to their processes and now they have more structure and visibility of their supply chain. With EDI, customers have more data to be able to review their ordering processes with specific partners and find possible improvements. We had a customer implement invoices and it has significantly improved payment visibility on outgoings, outstandings, and been much easier for suppliers to onboard compared to email based processes.Want to go through your EDI requirements with an experts? Getting in touch with us below.

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Reducing manual processing: Where does EDI fit?

In this efficiency-driven world, reducing manual processing in business can pose significant benefits. Many areas within business require manual processing and, as is the case when doing any manual data entry, it produces errors. On top of this, as orders increase, so does the amount of data entry, increasing your labour costs. EDI can help improve various business processing requirements. Here’s how.

Automating order processes

Entering and responding to orders can be time consuming. EDI integration with your ERP system can streamline and automate this process. It allows you to exchange EDI messages directly between yours and your partners’ software. This means no need for sending emails with purchase orders, entering them manually or emailing responses back to customers. Overall, it creates a significantly more streamlined procure-to-pay cycle.

Integration may not be right for all customers though, so MessageXchange also has a service for businesses using MYOB or Xero. Our FormXchange solution allows businesses to receive orders directly into their MYOB software. Then action everything in FormXchange and have the invoice go into MYOB or Xero. No double handling necessary.

Simplifying processes with 3PLs

Sending orders onto your logistics provider can add to your manual processing. EDI integration is a great way to automate this part of order fulfillment. Suppliers can receive orders from customers and have a copy of that information sent directly to their 3PLs. This can all be managed in your MessageXchange Gateway, so there’s no need for emails or separate portals to send information on.
For Colladium customers, we offer the ability for you to send pick requests directly to your 3PL and they can then fulfill the order and send the corresponding advanced shipping notice to your customer. This saves you the back and forth needed to send logistics details to your customer, while making it easy for your 3PLs to prepare the required messages. Find out more about Colladium’s 3PL integration here.

Reduce manual processing of invoices

Another critical stage in the order-to-cash and procure-to-cycles pay that creates a lot of manual processing is invoicing. EDI integration can help improve this for both buyers and sellers. Sellers can send invoices electronically straight from software and receive responses back from buyers to confirm receipt and even payment.

Buyers can get invoices straight into their software and can process them in a moment. With MessageXchange, you can set up business rules to check invoices as they come in, to automate invoice approval before payment.Want to learn more about our implementation process? Ask our experts by getting in touch below.

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eInvoicing for SMEs: Why government wants to increase adoption

eInvoicing is kicking into gear with small business. Many of the key benefits of eInvoicing positively impact small business, particularly faster payment times. The government is adding funding to increase adoption of eInvoicing to small business. Here are some of the initiatives planned by the government to increase adoption and what options you have to get started with eInvoicing.

Fighting digital scams

Small businesses are among the potential beneficiaries of a $67.5 million funding package to help fight digital scams. The funding would be used to implement measures and technology to reduce digital scams. One of the key technologies to fight scams is eInvoicing. The eInvoicing network reduces scams by registering all users in the network making it difficult for scam users to get through.

Increasing funding to reduce payment times

The average payment term for Australia's small businesses is currently 35.8 days. Government sees long payment terms as a pressing issue for SMEs. As part of their budget announcement, there will be $25.3 million invested to improve payment times to small businesses. Some of this funding is to support the Payment Times Reporting Regulator to implement reforms recommended by a statutory review that will help small businesses improve payment times.

Funding for ATO to use towards the eInvoicing network

$23.3 million to increase eInvoicing adoption. Government is securing more large business champions who will actively promote and onboard business partners to eInvoicing in their supply chains. As larger businesses jump onboard they will be looking to onboard their suppliers both big and small. In addition to this, some of the funding will be used to create the following initiatives in increasing eInvoicing adoption including:

  • Treasury will continue to explore policy that could increase economy-wide adoption of the technology.
  • Working with industry to resolve implementation issues and irritants.
  • Working with DSPs to explore further opportunities to proactively register customers onto the eInvoicing network.

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Prevention is better than a cure: Here’s how to prevent issues when implementing EDI

Putting some effort in before embarking on your EDI journey will put you in good stead. Think about your processes and what you’re trying to achieve up-front, and it’ll help you navigate through the stages of implementation with ease. Here are our suggestions of things to consider.

Get your relevant teams involved

When you’re going through the implementation stages of EDI, it’s important to have a core team that includes a representative from all relevant departments of the business. Having all teams involved in the EDI process ensures communication and transparency of the EDI project. It also ensures understanding and consistency of the objectives and goals of the project.

Be clear on your requirements

Clearly defining your requirements as well as your trading partners’ requirements is key. Some things to think about are:
  • How you’ll connect to your VAN, whether that’s by sFTP, an API, AS2 or something else.
  • What file format your software exports and imports
  • What file format you’ll exchange with your trading partners
  • If you require any business rules, validations or data enrichment.

Have a plan for onboarding

Planning ahead for the onboarding stage of implementation is important to ensure success. If you’re onboarding your suppliers, make sure you segment them according to the goals you’ve set. This might turn out to be segmenting by capability, or order volumes. Each segment needs to have tailored communications that relates to them. If you’re a supplier onboarding to EDI, think about how you will comply with your partners’ requirements. If you’re not using EDI, you’ll need to look at either a web portal solution or an integrated solution. We go over what might be best for you in our blog here.

Testing with your EDI provider and trading partners can take time

During testing, the best thing you can do is be as prepared as possible. This means having a team that is set to do the testing. They will send and receive messages back and forth, but the faster they can respond, the quicker testing will be completed. To relieve pressure on retailers who are onboarding suppliers, MessageXchange provides a message compliance testing (MCT) tool. This automates the testing process for you so suppliers can login to a portal and go through the testing process themselves. This reduces the need for retailer teams to be following up with suppliers. The tool allows suppliers to:
  • generate realistic POs in the format they would receive in production, complete with their GLN, vendor number and products.
  • upload messages they would send to you in production, like shipping notices, invoices, control messages and even SSCC labels for you to check.
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Australia Budget 2024: Fighting fraud and increasing cash flow through eInvoicing

In 2023, total losses from reported scams reached $2.74 billion, according to the ACCC’s Scamwatch. In response to this, we saw the recent Australian federal government budget announcement include significant funding for digital technology and fraud reduction. eInvoicing is one of the way the government sees businesses, government and the wider economy can benefit from digital technology and achieve a reduction in fraud. Here’s how the budget announcement impacts eInvoicing.

Improved cash flow

The government is looking to fund initiatives that improve payment times to small businesses. They have committed $25.3 million over 4 years to improve cash flow and boost productivity by supporting the Payment Times Reporting Scheme. This adds to the existing policy introduced by the government of 5 days payment terms for all invoices where Peppol compliant eInvoicing capability exists.

Increased eInvoicing adoption

The Australian Taxation Office (ATO) will receive $23.3 million to continue operating the nation’s eInvoicing network. This funding will also be used to increase eInvoicing adoption in the economy to improve cash flow, disrupt payment redirection scams and boost productivity for small businesses. As part of this funding the government will be:
  1. Continuing the operation of the Australia Peppol Authority and the eInvoicing network, including specifications, accreditation, and network governance.
  2. Working with DSPs, business, and government to ensure the eInvoicing environment is ready to expand at scale:
    • Increasing federal agency readiness to send and receive eInvoices.
    • Working with industry to resolve implementation issues.
    • Increasing DSP readiness.
  3. Targeted activities to increase adoption:
    • Working with DSPs to explore further opportunities to proactively register customers onto the eInvoicing network.
    • Securing more large business champions who will actively promote and onboard business partners.
  4. Develop policy:
    • to help embed eInvoicing as a default channel for sending and receiving invoices in government.
    • to increase economy-wide adoption of the technology.
    • To developing eInvoicing branding.

Fighting digital scams

Small and medium businesses are among the potential beneficiaries of a $67.5 million funding package to help fight digital scams. The government will give $37.3 million to develop mandatory industry codes and enforce them to guard against scams through a Scams Code Framework.Want to learn how eInvoicing help your business against scams and improve efficiency? Get in touch with our team by completing the form below.

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Paying eInvoices: How to automate approvals and payments

For businesses in Australia and New Zealand who take advantage of electronic invoicing (eInvoicing), they can nor automate the approval and payment processes to save a significant amount of time, money and resources.

Automating approvals of eInvoices for payment

Traditional invoicing processes often involve manual approval workflows, which can be time-consuming and prone to delays. With eInvoicing data, businesses can automate the approval process by setting predefined rules and workflows. For example, invoices can be automatically crossed check with predetermined criteria for approval such as invoice amount, purchase order number, quantities on the order, quantities received and prices on invoice match those on the order. This streamlines the approval process, reduces bottlenecks, and ensures invoices are processed in a timely manner.

Streamlining payments with payment gateways

MessageXchange allows you to set criteria to automate the payment of an eInvoice through our Payment Gateways. Once the approval criteria is deemed to be met, your Gateway can then create the payment and send it onto your bank. MessageXchange is even smart enough to look at things like your company’s cash position, to determine the best payment method. This saves teams time from having to check how payment should be completed. Conversely, if the approval criteria is not met, an escalation workflow can be invoked for further review. This saves teams time and reduces the risk of paying fraudulent invoices, or even overpaying legitimate invoices.

Benefits of integration

Automating approvals of eInvoices for payment offers numerous benefits for businesses:
  1. Improved efficiency: Automation reduces the time and effort required to manage invoices, approve them and process payments, freeing up valuable resources for other tasks.
  2. Faster payments: Automated payment processing ensures invoices are paid promptly, improving customer relationships.
  3. Reduced errors: Automation of eInvoicing and payment approvals minimises the risk of human error, ensuring accurate invoicing processing.
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You can already receive eInvoices. Here’s why you should consider sending eInvoices

Electronic invoicing, or eInvoicing, has emerged as a powerful tool for streamlining business operations and improving efficiency. In countries like Australia and New Zealand, Government has already embraced eInvoicing for receiving invoices. However, there's a compelling reason to also start sending eInvoices too.

With Australia and New Zealand already mandating government agencies have the ability to receive eInvoices, government suppliers will continue to be encouraged to send them eInvoices. The sweetener for suppliers is getting payment sooner.

New Zealand is now looking to ramp up government agencies sending eInvoices. This comes off the back of comments made by the New Zealand Minister for Small Business and Manufacturing, Hon Andrew Bayly.

No doubt there are a lot of benefits to receiving eInvoices. So why send eInvoices?

Digitise your invoicing process

One key benefit is making it easier for customers and other agencies to do business with you. As more of your customers sign up to eInvoicing, you’ll likely receive more requests to start sending eInvoices. Government agencies can make customer experience more seamless by sending eInvoices directly into the recipient’s software.

Faster payment processing

Sending eInvoices to customers’ makes the process more seamless. There’s no need to send emails or PDFs – eInvoices are sent straight from your software to the recipient’s software. This accelerates the invoicing cycle by delivering invoices instantly to recipients, ready for them to be approved and paid, faster than manually-received invoices.

An eInvoicing standard makes it easier to exchange eInvoices with everyone

Australia and New Zealand have teamed up to develop one standard for exchanging eInvoices with businesses across both countries. This means once a business is setup, it can send eInvoices to any other business who receives eInvoices. Unlike some other forms of exchanging data, you can set and forget. Want to learn more about sending eInvoices to your customers? Get in touch with our team with the form below.

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What to think about when onboarding customers to eInvoicing

For many Australian and New Zealand businesses, the shift towards electronic invoicing (eInvoicing) can feel like an uphill battle. While the potential benefits – faster payments, streamlined processes, and reduced costs – are undeniable, achieving widespread adoption can be a challenge.

Understanding customer needs and concerns

Businesses come in all shapes and sizes, and their eInvoicing readiness varies greatly. It's crucial to understand your customers' individual needs and concerns. Consider asking customers directly or send an informal survey to gain insights into their:

  • Current invoicing processes: What pain points do they experience receiving traditional paper or PDF invoices?
  • Level of technical expertise: Are they comfortable using new technologies? What level of support would they need?
  • Concerns about eInvoicing: What hesitations or reservations do they have about adopting eInvoicing?

Addressing customer concerns and making eInvoicing easy

Once you understand your customers' perspectives, you can tailor your approach to address their concerns and make eInvoicing a smooth transition for them. Here are some key strategies:

  • Offer flexible options: Don't force a one-size-fits-all approach. Provide a variety of eInvoicing solutions, including web portals and integrated solutions, to cater to different preferences and technical capabilities. MessageXchange offers customer a free portal for partners to use, Colladium.
  • Prioritise education and support: Provide clear and accessible resources, such as user guides, FAQs, and training webinars, to help your customers understand and implement eInvoicing. Offer ongoing support to answer questions and address any issues they encounter, or be able to refer them to someone who has the answers.
  • Focus on the benefits: Clearly communicate the value proposition of eInvoicing to your customers. Highlight the faster payment cycles, reduced costs, and improved efficiency they can expect.

Building a collaborative ecosystem

Remember, eInvoicing isn't just about your individual business; it's about fostering a collaborative ecosystem where all participants benefit. By working with your customers, industry partners, and government agencies, you can create a smoother and more efficient invoicing experience for everyone.

  • Engage with industry associations: Collaborate with industry bodies and peak organisations to advocate for eInvoicing standards and best practices.
  • Advocate for government support: Encourage government initiatives that promote widespread eInvoicing adoption across the economy. This could be working with Government for them to motivate others towards eInvoicing.

By prioritising your customers and building a collaborative ecosystem, you can unlock the true potential of eInvoicing and create a more efficient and prosperous business environment for all. Remember:

  • Tailor your approach to the specific needs and concerns of your Australian and/or New Zealand customer base.
  • Offer flexible options, provide education and support.
  • Focus on the benefits of eInvoicing and build a collaborative ecosystem with industry partners and government agencies.

By taking these steps, you can turn eInvoicing adoption from a challenge into a win-win for your business and your customers.Want to learn more about how to work with your customers to get them onto eInvoicing? Get in touch with our team with the form below.

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The evolution of EDI file formats from EDIFACT to ANSI X12, XML and beyond

Remember the days of paper invoices piling up on your desk? Thankfully, times have changed, and electronic data interchange (EDI) has revolutionised business-to-business (B2B) communication in Australia and around the world. But EDI formats themselves haven't been static – they’ve evolved to meet the ever-changing needs of modern commerce. So, let's explore the world of EDI file formats, from their humble beginnings to where they're headed next.

EDIFACT: The start of EDI formats

Back in the days of dial-up modems and chunky desktops, EDIFACT (electronic data interchange for administration, commerce and transport) emerged as the global standard. As the first file format in Australia in the EDI space, it got a head start on other file formats. This format uses tags and codes to structure data (some tags include BGM (Beginning of message) and IMD (Item description)), ensuring everyone involved could understand the information being exchanged. EDIFACT offers stability and reliability, becoming the go-to format for many industries, especially retail.

XML: A breath of fresh air

As technology moved forward, more file formats began to emerge. Enter XML (extensible markup language), a format based on human-readable tags and values, like labelling your tools in plain English. Tags in XML can be anything, but more commonly they can be human readable like or or . This offered a range of benefits:

  • Flexibility: XML could easily adapt to new data types and business processes.
  • Interoperability: It wasn't tied to specific industries, making it easy for diverse businesses to connect.
  • Human-readability: Understanding the data is simple.

JSON: The lightweight contender

Think of JSON as the text messages of the data world: simple, quick, and perfect for short bursts of information. It's a lightweight format often used in web-based APIs, where real-time data exchange is crucial. While not a traditional EDI format, JSON can play a role in specific EDI scenarios, such as:

  • API integrations: Businesses can use JSON to exchange data with other systems, their EDI provider and applications through APIs, streamlining data flow.
  • Complementary to other formats: JSON can be used alongside XML or UBL to transmit specific data elements within an EDI message.

ANSI X12: A widely adopted standard

ANSI X12, or the American National Standards Institute's Accredited Standards Committee X12, is a another file format used in electronic data interchange (EDI). This standard, as you can see in the name, is commonly used in North America. It sets guidelines and rules for structuring and formatting electronic business documents. ANSI X12 has a similar hierarchical structure to EDIFACT/EANCOM but segment names are very different, and how the content is structured is different too. This standard plays a crucial role in enhancing operational efficiency, reducing costs, and minimizing errors in electronic transactions, ultimately fostering smoother and more reliable business relationships.

Remember, choosing the right format depends on your specific needs, industry, and trading partners. So, keep your ear to the ground, stay up-to-date on the latest EDI trends, and ensure your business stays ahead of the curve!Want to learn more about how MessageXchange can help with your data integration needs? Ask our experts by getting in touch below.

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