04/03/2021

Three common challenges onboarding suppliers to eInvoicing and how to overcome them

Three of the most common challenges we hear about when customers have onboarded their suppliers to eInvoicing are:
  • lack of knowledge from those you’re onboarding
  • getting buy-in from those you’re onboarding, and
  • sticking to your timeline.
But luckily we’ve got some suggestions for these challenges.

Lack of knowledge

Because it’s still in its infancy here in Australia and New Zealand, you might find that the partners you’re onboarding to eInvoicing only have a very basic understanding of what it is and how it works. This can make it hard for them to feel comfortable enough to make the move. The best way to overcome this is to give them the information they need. Start with the basics like:
  • how eInvoicing works
  • Introduce Peppol
  • what’s in it for them
  • explaining Access Points and what they do
  • where and how to find an Access Point.
It’s also important to make sure your partners don’t fall for any myths about eInvoicing, like it being costly or that it takes a long time to implement. There are free eInvoicing solutions out there that are easy to get setup and use (like colladium.com – it takes minutes to get started), and even paid services can cost as much as a phone plan and take less than a day to set up. Promoting the opportunities and savings of eInvoicing is also a really great way to diminish concerns. Another thing you should pass on to your partners is any business requirements you might have. Things like having due dates in the future or having invoice numbers with no symbols.

Getting buy-in from those you’re onboarding

Another commonly-reported challenge is getting buy-in from your partners. The lack of knowledge (like we’ve spoken about above) doesn’t help to start with, but often the concept needs to be sold to them and some may need to be hand-held. Firstly, be clear on why your organisation has chosen to use eInvoicing. It could be to enable faster payments, improve processes or something else. The next thing is to promote the benefits eInvoicing can have on your suppliers’ businesses. This is the sell. Think about things like:
  • Cost savings 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.
  • Easier invoice processing Removes the need for unnecessary data entry - the invoice just appears in your software.
  • Faster invoice payments The average eInvoice is processed in 5 days (compared with 23 days for a regular invoice). Or if you’re promising so pay eInvoices in a certain time, mention that here.
  • Fewer errors Because much of the data entry is removed.
  • Security Security measures, like encryption at rest and in transit, are implemented throughout the eInvoicing network so your data remains secure along the way.
I mentioned above that some of your partners might need some hand-holding. So keeping regular contact during the onboarding process can be useful too. Have a think about:
  • Holding information sessions and webinars to educate your partners This can also be a great indication of who might be interested in onboarding and prioritise them first.
  • Listing eInvoicing providers This makes it easier for your partners to get onboard. Having low or no cost solutions are always more likely to entice your partners. MessageXchange provides a free tool, Colladium, for customers to get their partners started.
  • Making direct contact Pick up then phone and chat them through it. They might just need someone to talk them through it one-on-one.

Keeping to your timeline

If this is your first rodeo, you mightn’t know what to expect. After all, how long is a piece of string? Firstly, be realistic about the timelines you set for yourself. And call on the expertise of your Access Point provider. The likelihood is that if you’ve chosen a reputable, experienced company, they’ve seen this done many times over. Putting together a comprehensive communication and implementation plan puts you in the best position. Make sure you put together a timeline of your communications and the groups you’ll be sending it to. This will help you stay organised and ensure you don’t miss any communications to your suppliers. Another thing you can do is plan ahead for the changes at your end. Break down what each department will need to do in preparation, and when you’ve gone live to send and receive eInvoices. Don’t forget we’ve got this whitepaper, A guide to successfully onboarding trading partners to eInvoicing. Check it out if you’re new to this all. There might be some things in there you haven’t thought about before. If you’re interested in learning more about onboarding partners to eInvoicing, request a call from our eInvoicing team below.

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E-invoicingRetailers

23/02/2021

Data driven decisions with EDI

The key to effective decision-making is having relevant and accurate data at your fingertips. This is where electronic data interchange (EDI) can help. EDI reduces errors, which significantly improves data accuracy. EDI can capture data such as:
  • the number of purchase orders and invoices exchanged
  • the number of invoices waiting to be issued
  • how long the delivery of goods take from the time they’re ordered
  • the orders, or the percentage of them, that are fulfilled in a certain period
  • and more.
Let’s have a look at how best to use this data.

See your top suppliers by volume and value

Seeing who your top suppliers are, either by the volume or orders you raise, or the value of them, is useful for any retailer to know. It’ll let you know what your key relationships are, because after all, the old 80/20 rule applies here – around 80% of your stock is likely to come from 20% of your suppliers. EDI gives you easy access to this information.

Improve stock management

Whether you’re a retailer or a supplier, having data on buying patterns can help optimise your stock management. EDI captures what’s being ordered, how much of it and when, which can help you identify trends. This will help you better predict demand, and help with just-in-time ordering to reduce the risk of overstocking or understocking.

Monitor suppliers’ delivery performance

With a purchase order and an advanced shipping notice, it’s easy to capture data on how long goods are taken to despatch after being ordered, how long they’re taking to arrive after being despatched, and how accurate the delivery time on the advanced shipping notice is. With this data, retailers can add KPIs around delivery and use the information from the EDI messaged to monitor it. You can use this to identify the suppliers that aren’t meeting requirements and might need some attention.

Identify your slow-paying customers

It’s important for retailers to maintain good relationships with suppliers. For them, a big issue can be slow-paying customers. Cash flow is key for any business, particularly for suppliers where margins are generally thin. That’s why it’s important for retailers to monitor their outstanding invoices. EDI data on the invoice captures due dates and a remittance advice tracks when it’s been paid. It’s easy to create report to see, at a glance, which invoices are outstanding. This helps retailers prioritise payments and ensure you don’t miss any payments.

Failed orders per supplier

Keeping track of failed messages, but particularly orders, is key to maintaining a well-oiled supply chain. After all, if an order doesn’t reach a supplier, you can be sure the stock won’t reach you or your customer. By monitoring failed orders, you can identify the orders that need troubleshooting. It could be a one-off issue, but if not, it also allows you to recognise consistently troublesome suppliers and reach out to them. If you’re interested in learning more about how EDI helps with decision making, request a call from our EDI team below.

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EDIRetailersSuppliers

12/02/2021

Creating an EDI compliance program for onboarding suppliers

When you implement EDI for the first time, comprehensive testing is undertaken. This testing is on the mapping from your software’s format to that of the standard you’re using, like EDIFACT D01B or D96A, is correct and working as expected. But what about when you onboard suppliers? Compliance testing with suppliers is often overlooked, but if you’re onboarding large volumes of suppliers, it’s something that can bring huge payoffs in the end. It makes sure your suppliers can correctly process the EDI messages you send them, and checks that the messages they send back to you match what you’re expecting. Imagine onboarding suppliers, sending out hundreds of orders in those first weeks and having them fail. Not only will your stock not arrive, but your team will have to spend time troubleshooting the issues and getting the orders to your suppliers again. This is all when your stores are expecting stock to arrive.

What is an EDI compliance program?

In short, the process checks the EDI messages your supplier will send you. The checks are done early on in the process, so you don’t run into issues like the one above, where you’re scrambling to get things corrected. The compliance program can be administered manually, or you can choose an automated program like we offer on Colladium.

What does an EDI compliance program check for?

You can design the compliance program to be as simple or as complex as you need. What you choose will depend on your business. It can check things like:
  • File format Like making sure they’re sending an EDIFACT D01B message rather than a CSV file.
  • Syntax Like making sure the elements are in the correct spots.
  • Business rules within a message Like making sure the invoice number doesn’t have any special characters.
  • Business rules within the procurement conversation Like making sure the invoice date is after the ASN date. Or making sure your supplier can send the correct messages to ship goods in one despatch as well as multiple.
  • and more.

Why use an EDI compliance program?

Basically, it helps you find any issues before you move to EDI in production with your suppliers. Just look at the example above – the last thing you want is to have sent out a whole bunch of orders, which your stores are waiting for, only to find out they’ve failed somewhere along the way. Without it:
  • stock could be delayed arriving
  • stores will expect stock that won’t arrive
  • your team will need to scramble to troubleshoot the issues
  • customers might not receive the stock they ordered when they expected.

What do I need to do to prepare for the EDI compliance program?

First, decide and document the workflow you want to check

For example:
  1. Send your supplier a test purchase order.
  2. Ask your supplier to confirm they can process it successfully.
  3. Ask your supplier to send you a test purchase order response, fully accepting the order you sent them in step 1.
  4. Confirm the message you received is as expected. If not, start again from step 3.
  5. Ask your supplier to send you a test purchase order response, rejecting the order you sent them in step 1.
  6. Confirm the message you received is as expected. If not, start again from step 5.
  7. Ask your supplier to send you an advanced shipping notice for the order response they send you in step 3.
  8. Confirm the message you received is as expected. If not, start again from step 7.
  9. Ask your supplier to send you the SSCC labels they generated from the ASN they sent you in step 7.
  10. Scan the labels at your end and ensure they meet your requirements. If not, start again from step 9.
  11. Ask your supplier to send you an invoice relating to the ASN they sent you in step 9.
  12. Confirm the message you received is as expected. If not, start again from step 11.

Then decide and document business rules you want to check

This could be:
  • The date formats you require
  • Dates must be in the future
  • Whether prices on the invoice and order must match
  • Whether quantities on the invoice must match or total those on the order
  • A vendor number is present on all messages
  • Invoices must be received within seven days of shipment
  • Order response must be issued within a day of the order
  • One invoice is issued per ASN.

What are my options for an EDI compliance program?

As we’ve mentioned above, you can choose to do this manually or choose an automated program.

A manual EDI compliance program

You could probably start using this today. You can generate a test order and email it to your supplier, they’ll ingest it into their software, generate the next message and send it back to you. The really time-consuming part comes in when you need to check the file manually to make sure it meets all the criteria you documented in the workflow section above. Let your supplier know the issues you find and what you’re expecting instead. Continue this for each step. The obvious downside to this method is the amount of manual labour involved. If you’re onboarding even a couple of suppliers a week, this could easily take up days of work. Not to mention, you may be dictated by when you and your supplier are both ready to test.

An automated EDI compliance program

An automated EDI compliance program requires far less manual work for you. If you chose to use Colladium, for example, we’d spend a bit of time configuring your requirements, like workflow and business rules. Then all you need to do is invite your suppliers. They’ll be prompted to download an order (this will be generated automatically), then confirm that it was successfully processed, all from within the portal. When they upload messages, like an order response, the portal validates everything in the message against your business requirements. It displays all of the errors on the screen for your customer to see. The good thing is, that they can continue to upload their files as many times as they like, and have it validated there and then. There’s no waiting for your staff. And you have full visibility of everything – where your supplier is at in the workflow, what’s been successful and more.

What are the benefits of an automated EDI compliance program?

  • there’s no need to be on the phone or sending emails to suppliers constantly to fix errors
  • it’ll cost you less
  • there’s no need for additional labour
  • your team can spend more time on other tasks.
If you’re interested in learning more about EDI compliance programs, request a call below.

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EDIRetailers

04/02/2021

Getting your accounts payable department ready for eInvoicing

eInvoicing can help businesses improve their processes and save money. But often the success is dependent on the collaboration within the business – how well you can bring everyone on the journey. One of the key departments to be involved is accounts payable.

Think about your accounts payable team’s current processes and how they’ll change

The processes of traditional invoicing and eInvoicing can be different for your accounts payable team. Traditional invoicing looks something like this:
  1. Receive email with PDF invoice
  2. Send to accounts payable team
  3. The invoice is downloaded, reviewed and approved
  4. Accounts payable inputs invoice information into relevant software programs
  5. Invoice is paid and archived
eInvoicing cuts out a lot of the manual processes by automating the inputting into your software. It looks a bit more like this:
  1. The seller sends the invoice electronically from their software. The invoice is sent, almost magically, through the Peppol network directly to the buyer’s accounts payable team’s software.
  2. Accounts payable match the received invoice against the PO for payment authorisation.
As you can see, your accounts payable team’s processes will change with eInvoicing – they’ll no longer have to input invoices into their software.

Planning for eInvoicing

There are a few things you can do to plan ahead for receiving eInvoices.

What’s in it for them?

Figuring out what’s in it for each team when it comes to eInvoicing, is an important step to bring them along on the journey. In this case, your accounts payable team won’t need to spend nearly as much time on entering invoices into your software. And if you’ve setup automated matching in your software, the automation could handle with mismatches like incorrect prices, or the absence of a purchase order number – something that your accounts payable team would have handled in the past. So all in all, it’ll mean less work for them, and more time they have to spend on the more important things.

Knowledge sharing

You not only need to get buy-in from each team, but you also need to make sure they’re armed with all the information they’ll need. It’s worth running a session with your accounts payable team to explain to them:
  • what eInvoicing is
  • what’s in it for them
  • what will change for them
  • what’s in it for your customers and suppliers
  • what the process be for your customers and suppliers
  • what questions they might get from suppliers and how to answer them
  • and who to contact for help.

Who will look after the supplier onboarding and communications?

If you’ve decided that your accounts payable team hold the relationship with your customers and suppliers, you might task them with the onboarding and communications. Skill the team up before the rollout to make sure they’re well equipped with the information and collateral they need, as well as making sure they’re familiar with what you’re asking of your customers and suppliers. We’ve got a handy resource you can use as a starting point, ten steps to successful community onboarding.

What if something goes wrong?

Your accounts payable team need to be ready if things go wrong or if they get curly questions and know what process to follow. If a supplier says they’ve sent an invoice but they can’t see it in your software, should they contact your IT team or Access Point provider? If your team are contact by a supplier who’s received a notification to say their invoice has been rejected, who should your accounts payable team contact? It’s also worth having a plan for the case that your suppliers can’t send an eInvoice because of an issue on their end. Perhaps you offer email as a last resort. If you’re interested in learning more about getting your accounts payable ready for eInvoicing, request a call below.

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E-invoicingRetailers

03/02/2021

Traditional invoicing vs eInvoicing: An infographic

This isn’t sending a PDF and or sending an email, eInvoicing is software to software and 100% automated. By comparing traditional invoicing and eInvoicing we can see just how efficient e-invoicing can be for both buyers and sellers.

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E-invoicingRetailersSuppliers

27/01/2021

EDI: Debunking the myths

Electronic data interchange (EDI) automates procurement, eliminating a lot of manual processes. But there are some myths that make some businesses think twice about implementing it. Here are some of those myths busted.

EDI is costly

There’s an assumption that EDI is too costly and not worth the investment. This myth is often based on outdated technologies. Technology has advanced ignorantly in the last couple of decades though, and EDI service providers can provide a range of cost-effective options for businesses. For businesses looking to comply with retailer requirements, a good option is to use a simple EDI web portal, where you send and receive EDI messages. This can cost the same as a monthly phone plan and many see EDI as a small price to pay to maintain their retailers’ business. EDI integration can work out to be extremely cost-effective too. EDI integration involves the exchange of business information directly between business software. This method can be more expensive than a web portal, but the benefits can definitely justify the investment. EDI integration automates manual processes and sends documents electronically, which creates significant cost savings. Some sources calculate the cost of processing an order manually to be around $38 compared to just $1.35 using EDI.

EDI is complicated to implement

There’s a perception that EDI is complicated to implement, with some believing EDI is difficult to understand and needs expert skills. EDI messages are just another coding language, sometimes even XML or CSV. Once you understand how they’re constructed and what each element means, it’s as easy as pie. There are now even EDI standards, which have simplified this even further. In the end, EDI will make your processes more streamlined and improve your business communications. Plus, if you partner with an experienced EDI provider, they can often hold your hand through the process.

EDI creates errors

Some believe EDI can cause bugs and errors. There are a few reasons why this is wrong. These days there are a range of tests and approvals before a company goes live with EDI. For example, here at MessageXchange, we perform testing between you and us, the EDI provider, as well as end-to-end testing with your trading partners. It’s only once these tests are completed and passed that EDI is moved to production.

EDI slows down business processes

Many worry that moving to EDI will be disruptive to their businesses. It is believed that EDI interferes with business processes which slows down workflows. Overall, EDI can be quick to implement, depending on your goals and solution. If you stage your EDI implementation correctly, and gear your implementation to achieve your biggest objective first, it’s can really improve speed and productivity. This gives staff more time to work on other tasks. It also reduces the risk of errors and therefore the time needed to correct them. Studies show paper orders can take upwards of 10 days to fulfill, while EDI orders can take less than a day.

EDI is used less and less

You might’ve seen comments about EDI’s declining use and its possible replacement by other technology like APIs. APIs are actually used by most current EDI service providers. They shouldn’t be thought of as an opponent to EDI, but as just another connection protocol for EDI, like sFTP or AS2. After all, APIs don’t follow a generic standard, whereas EDI does. That means it’s faster and easier to onboard new trading partners. EDI use is in fact growing around the world. Over 60% of businesses across the United States already use EDI in their daily operations. If you want to learn more about EDI and how it can help your business, request a call back from one of our team.

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EDIRetailersSuppliers

16/12/2020

Tips for successful onboarding of your partners to eInvoicing

eInvoicing is gaining popularity as more organisations look to benefits from its efficiencies. 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. To get the most out of eInvoicing, one of the most important things is successfully onboarding your customers and/or suppliers.

Why is onboarding so important?

It maximises your ROI

Every invoice you can process through eInvoicing increases your ROI. Generally, your setup cost is fixed, so get the most out of it through onboarding as many customers or suppliers as possible. Having all of your partners trading through the same method also reduces your costs because you don’t have to maintain several processes.

You use one process with all your suppliers

Businesses that don’t onboard all their partners have different processes for each. This makes invoicing for your teams more complicated and time consuming. If you still receive email and PDF invoices your accounts payable team still need to manually input the figures into your system.

The process of onboarding

There are a few steps in the process of onboarding partners to eInvoicing. It’s important to prepare for each one.

Segmenting

This stage assesses the ability of your partners to implement eInvoicing. Segment your partners into different levels of capability such as:
  • Those already using eInvoicing They’re ready to start sending you eInvoices and you send them eInvoices.
  • Those with the capability to start using eInvoicing Mainly those with ERP or accounting software and just need to enable eInvoicing.
  • Those currently not using software and physically receiving and sending invoices They could be using paper or sending documents via email.
These segments will require tailored communications and onboarding methods.

Communications

When onboarding your partners, it’s important to have a plan for communicating your transition to eInvoicing. This provides clarity and direction for the project. First things first, let your partners know you’re transitioning to eInvoicing. Communicating any type of change internally or externally is always daunting, but it’s important. At some stage, you may want to include requirements and message implementation guide (MIG) documents if you have them. MIGs are guides that detail what data in what format will be required to be exchanged. When onboarding your partners, it’s important to have a plan for communicating with them. It’s more than just announcing that you’re moving to eInvoicing. The main things you want to do when communicating with them is:
  1. Bring them along on the journey You may want to communicate with your suppliers giving them updates on the progress of your onboarding.
  2. Get their buy in Talk about why you’re transitioning to eInvoicing but also mention the benefits for your partners to use eInvoicing.
  3. Give them the info they need and make it as easy as possible At some stage, you may want to include requirements and message implementation guide (MIG) documents if you have them. MIGs are guides that detail what data in what format will be required to be exchanged.
If you’re interested in learning more about the process and best plan for onboarding, read our whitepaper, A guide to successfully onboarding trading partners to eInvoicing.

Certification and testing

The Peppol eInvoicing framework has certain fields that can be used within eInvoices. If you require certain fields on your invoices outside of these you’ll need to test your partners messages to ensure they include these fields. Once you’ve decided on these additional fields make sure to document it in a MIG or elsewhere. You will then need to ensure the eInvoices that your suppliers will send to you include these fields and are Peppol-compliant. MessageXchange provides customers with message compliance testing (MCT) service that is customised to each business’ needs. Your supplier will upload their Peppol eInvoice file to a portal, which will check its syntax, business rules and more against your requirements. It’s a simple interface for suppliers to test their messages and ensure it meets your requirements before they start to send you production-ready invoices. It also saves you from manually testing with your suppliers, which can require constant back and forth.

Managing a hybrid process while you onboard

It’s normal and expected that businesses maintain multiple invoicing processes while they’re onboarding suppliers. After all, not every business is in the same level of readiness when it comes to eInvoicing. Some may be more advanced than others. Some may be reluctant to change. For this reason, you’ll need to have different processes for different businesses. Initially you will need to continue operating in the same way with some businesses as you transition others to eInvoicing.

Tips for success

There are a few things to keep in mind to make the process go smoother.

Stage your onboarding process

It might be a good idea to start with the partners you know are ready and get them onboarded first. Then you can focus on other partners that might be less capable. Start with a small number at a time to make it more manageable, and to give you an opportunity to learn what to do, or not to do.

Remind partners of the benefits for them

It’s one thing to communicate your reasons for jumping on eInvoicing but it’s a good idea to make it clear how it’ll benefit your partners too. Reinforce these benefits in your communications throughout each stage. This will help them transition and comply with your process.

Give them options for compliance

We touched on your partners’ ability earlier on. It can be helpful to suggest options for compliance. You might think suggest a web portal to issue eInvoices for those who use their existing invoicing software. This can make it cheaper and easier for them to comply. We provide a free portal, Colladium, for these types of businesses to issue and receive eInvoices.

Seek help

If you’re stuck at any point in the process or need help always look for help. Your eInvoicing Access Point, or provider, can be a good starting point. They’ve likely seen the issue before, or know someone who has. If you’re interested in implementing eInvoicing for your business, request a call back below.

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E-invoicinggovernmentRetailersSuppliers

15/12/2020

eInvoicing and goods not for resale (GNFR): A recipe for success

Retailers are forever looking for ways to cut costs. Typically, it’s operations and supply chain that are targeted to improve efficiency and reduce costs. Retailers often adopt electronic data interchange (EDI) to automate the procure-to-pay process. But another, often overlooked area where processes can be optimised is also in procurement; it’s goods not for resale, or GNFR.

What is ‘goods not for resale’?

Goods not for resale covers anything that’s purchased without the intent of being re-sold. Things like:
  • store fittings
  • training
  • facilities and office space
  • utilities
  • professional services
  • marketing
  • travel
  • IT.
Procurement in these areas can be forgotten because they’re often managed by individual departments and can fall through the cracks, making it difficult to get an overall picture. A solid GNFR strategy gives you better visibility and understanding of your total costs, allowing you to identify unnecessary spending and achieve business objectives.

Find new areas to reduce costs. Enter, GNFR.

During tough times, businesses often push their efforts to cost reduction. And this normally happens in supply chains and operations like:
  • reducing locations
  • reducing staff
  • cutting prices and increasing discounting
  • looking for cheaper suppliers and products.
Continuing this path is unsustainable, so it’s important to look at other areas for efficiencies. Some sources claim GNFR can represent around 25% of a retailer’s total operating costs. One way to manage and improve GNFR procurement processes is eInvoicing.

eInvoicing: one small change for business, one giant leap for cost savings

eInvoicing enables organisations to exchange invoices electronically, directly between invoicing software. 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, like MessageXchange. 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.When purchasing goods for your business, invoicing is one of the most time-consuming and costly processes. As a result of the automation from eInvoicing, a few benefits are:
  • Cost savings Studies have found that it costs, $27.67 to process a PDF invoice, and only $9.18 to process an eInvoice.
  • Easier invoice processing Removes the need for unnecessary data entry - the invoice just appears in your software. And by exchanging invoices directly between software, there’s less risk of them going astray.
  • Faster invoice payments The average eInvoice is processed in 5 days (compared with 23 days for a regular invoice).
  • Fewer errors Because much of the data entry is removed, reducing the risk of paying more for goods. This also improves data accuracy for use in reporting and optimising processes.
  • Better security Security measures, like encryption at rest and in transit, are implemented throughout the eInvoicing network so your data remains secure along the way.
GNFR typically accounts for 20% of a retailer’s spend but covers 80% of its suppliers and a high percentage of transaction volumes. If you compare the cost of a manual procurement process and an automated eInvoicing process in the GNFR space, it’s easy to see the cost savings add up. Request a call from one of our experts to learn more about how eInvoicing can help manage GNFR costs.

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E-invoicingRetailers

25/11/2020

OCR vs eInvoicing

Some of the challenges that finance teams, particularly accounts payable teams, can often face include:
  • too many manual processes
  • data entry errors
  • high costs from labour, printing and archiving
  • paying fraudulent or misleading invoices.
Two of the most common approaches to overcoming these issues are optical character recognition (OCR) readers and eInvoicing. So what should you choose?

What is OCR?

OCR is a technology that distinguishes printed or handwritten text characters of physical documents, such as a PDF document. The basic process of OCR involves examining the text of a document and translating the characters into code that can be used for data processing. OCR can be hardware using a physical scanner or software which takes advantage of Artificial Intelligence (AI) for character recognition.

How does it work?

Generally accounts teams upload the PDF or scanned document to their OCR software where the invoice is read, captured and input into their accounting software.

Pros and cons of OCR

From afar, it can seem that OCR reduces the amount of effort it takes to process and invoice, makes for faster processing and depending on the volume of invoices, can reduce costs. But because it’s not true data exchange because it scans an unstructured document and tries to interpret it, it can produce mistakes. Some consider 70% OCR accuracy as ‘good’. Identifying and fixing up these mistakes can be time-consuming and costly. Some of the other cons are:
  • a limited range of document types can be read
  • it isn’t always accurate, so further checks and balances need to be in place (often manual)
  • technology experts may need to be hired to look after your technology
  • upfront costs can be high.

What is eInvoicing?

eInvoicing enables organisations to send and receive invoices electronically, directly to and from their software. No need to scan an invoice before uploading it into your software like you do with OCR scanners.

How does it work?

eInvoicing in Australia and New Zealand is provided through a network of interoperable Access Points, like MessageXchange, that exchange your eInvoices using the Peppol standard that has been adopted around the world. You can think of it like a telephone network.

Pros and cons of eInvoicing

eInvoicing has a few key benefits:
  • cost savings from data entry, printing and archiving
  • easier invoice processing
  • faster invoice payments
  • fewer errors
  • exchanging invoices directly to and from software
  • Enhanced security.

Next steps

There are a few things you should think about when looking at eInvoicing:

Getting your business ready

To prepare your business, think about these things:
  • Define your objectives
  • Look at your business processes
  • Get the relevant teams involved
If you want to learn more about preparing for eInvoicing, check out our whitepaper, . At MessageXchange, we try to make things easier to get started with eInvoicing:[vc_column_inner width="1/3"]

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E-invoicinggovernmentRetailers

13/11/2020

What EDI messages are best to achieve my business objectives?

There are a few things businesses need to think about when implementing EDI. One of the key ones is your business objectives – why you’ve chosen to use EDI in the first place. This will dictate how you go about your planning and implementation. Your business objectives will also determine what messages you exchange with your partners.

What types of EDI messages are there?

EDI can go far beyond a purchase order and invoice. Some common messages are:
  • Purchase order Sent from buyer to supplier to order goods or services
  • Purchase order change Sent from buyer to supplier if the original purchase order has changed
  • Purchase order acknowledgement Sent from the supplier to the buyer to acknowledge receipt of the order
  • Purchase order response Sent from the supplier to the buyer to let them know how much of the order can be fulfilled, and any discrepancies from the original order
  • Advance shipping notice (or despatch advice) Sent from the supplier to the buyer to let them know when and how the goods will be shipped
  • Invoice Sent from the buyer to the supplier for payment of the goods or services
  • Recipient created tax invoice (RCTI) Sent from the supplier to the buyer for payment of the goods or services
  • Remittance advice Sent from the buyer to the supplier to confirm payment
  • Price/sales catalogue Sent from the supplier to the buyer with up-to-date product and pricing information
  • Product activity data Sent from buyer to the supplier with the number of units sold and units on hand
  • Transport instruction Sent from a buyer to a transport supplier (and related parties) to communicate transport arrangements
  • Transport response Sent from a transport provider to confirm instructions
  • Functional acknowledgement An automated response sent from a receiver of an EDI message to confirm receipt of the message.

What messages should you use?

Your objectives will influence the messages you should choose. Here are some examples:

If you’re trying to reduce manual handing

…the messages you should consider using are:
  • purchase order
  • invoice.
This means all invoices will come directly to your software electronically. No more need for your team to enter an invoice manually. You might ask why use a purchase order too. It’ll make it easier for your customers to receive orders, and will mean that they don’t have to manually enter them on their side. It usually leads to less errors throughout the process.

If you’re wanting to receive stock faster

…consider sending your purchase orders via EDI. By simply sending out a purchase order through EDI, it should get to your supplier significantly faster. They probably don’t regularly check their emails which can delay processing. It also means they don’t need to spend time entering it into the systems on their side.

If you’re after visibility of fulfillment

…the messages you should use are:
  • purchase order
  • purchase order response.
The purchase order is sent directly to your supplier’s software. And the purchase response is sent by your supplier to confirm whether your order can be fulfilled, and if it’s only being part-filled, it’ll tell you how much they can supply. These messages give full visibility of your order fulfillment.

If you’re trying to get better, more accurate information

…use a combination of:
  • purchase order
  • purchase order response
  • despatch advice and
  • or all of them.
A purchase order response will let you know ahead of time what the supplier will be able to send you. It helps you plan ahead if your whole order can’t be fulfilled. It also helps with data inaccuracies you might have. For example, if you don’t have the correct prices, you can let your suppliers amend prices on the purchase order response, which you can approve or not, before they despatch the goods. A despatch advice lets you know what’s coming, when and how. And getting the invoice electronically means your team don’t need to spend time re-entering it. All of the data from these can be used for reporting on supplier performance and more. An EDI invoice will mean you don’t have to re-enter the invoice data when it gets to you, which means less data entry mistakes.

If you’re trying to get better, more accurate information

Drop shipping is a popular business model for a lot of retailers. There are a few messages that can help you move to this model:
  • Purchase orders (PO)
  • Purchase order acknowledgement (POA)
  • Advanced shipping notice (ASN)
The PO gets the order to your suppliers as quickly as possible. The POA and ASN gives you visibility of where the order is at, and can even let you pass tracking information onto your customer.

If you want to receive deliveries more smoothly

There are two messages can help achieve this objective:
  • Purchase order (PO)
  • Advanced shipping notice (ASN)
Sending a PO gets your order to your supplier reliably. The ASN will let you know when to expect the delivery so your team is on hand to receive it. You can also use the SSCC labels to scan stock in to automate the receiving of goods.

If you want real-time data at your fingertips

There are a few messages that can help achieve this objective, including:
  • Purchase order (PO)
  • Purchase order response (POR)
  • Advance shipping notice (ASN)
  • Invoice
  • Sales forecast
  • Price/sales catalogue
The POR lets you know as soon as the supplier sends it, what they can supply. An ASN will let you know what’s being shipped, how and when. An invoice will help you see an accurate business position and liabilities. And price/sales catalogue makes sure you’ve got the most up-to-date data of the products you’re ordering. Never order with the wrong prices again. If you’re still struggling to decide what messages to use, have a chat to one of our experts. Request a call back below.

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EDIRetailers

06/11/2020

The state of eInvoicing in AUS and NZ

eInvoicing has taken off in countries around the world. Here in Australia and New Zealand, eInvoicing is still in its infancy, but steadily gaining momentum.

What is eInvoicing?

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 in Australia and New Zealand is provided through a network of interoperable Access Points, like MessageXchange, conforming to the Peppol standard. The standard was developed in Europe, but has been adopted around the world, including here in October 2019.

The current state of eInvoicing

The term ‘eInvoicing’ has been thrown around here in Australia for a number of years now. It really started to gain traction in 2019 when Australia and New Zealand signed a trans-Tasman eInvoicing agreement, allowing it easier for businesses both countries to exchange eInvoices. Today, the largest users of eInvoicing are government agencies. The Australian government is providing incentives for suppliers to use eInvoicing by promising suppliers with contracts less than $1 million payment within 5 days of issuing an eInvoice. In New Zealand, the government have set a target to pay 95% of all domestic invoices within 10 business days and eInvoicing is one of the key strategies to help reach it. New Zealand Inland Revenue (NZIR) was one of the first New Zealand government agencies to use eInvoicing. The focus for NZIR was to pay invoices early to help suppliers’ cash flow and to give them a seamless experience. Check out the case study here. The New South Wales state government has been a leader in eInvoicing in Australia. The Department of Customer Service (NSW DCS) recently implemented eInvoicing as part of the NSW Digital Government Strategy. The strategy’s purpose is to offer digital services that benefit customers and suppliers. Learn more about NSW DCS eInvoicing journey here. Some of the government agencies that are currently up and running with eInvoicing 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)
  • 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)

What's next?

The government is currently looking for ways to increase the uptake of eInvoicing. The 2020 Budget here in Australia includes $120 million in funding to help businesses implement digital technologies. It also includes $3.6 million to make eInvoicing mandatory for all government agencies by the 1st of July 2022. If you want to get all the latest eInvoicing news, sign up for our newsletter below.

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E-invoicinggovernmentRetailersSuppliers

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