What is the real cost of invoice processing?
In the continually evolving world of modern business, it is ever more critical to take advantage of technological advances to develop an edge.
Often it is the more mundane aspects of a business which represent a drain in resource and where significant benefits and savings can be obtained.
Despite this, many businesses struggle to balance the likely returns of automation with the inevitable costs in achieving these and therefore often decide to delay or not make the change.
So what should you consider when considering a move to the electronic processing of accounts payable?
What are your current costs?
Even though you have not invested in automating the processing of your invoices, there is of course still a cost, it may be hidden but it’s still there.
Consider:
• How many invoices you process?
• How many people are involved in this process?
• How much time do they spend processing invoices?
• How much paper is created and how do you store this?
• What errors are made and need time to resolve?
Processing invoices manually can be very expensive. Extensive research has concluded that to process a single invoice can cost as much as £50.
Choosing the AP solution to meet your needs
You will no doubt be aware that a wide variety of document management exist and whilst they all provide a similar delivery.
Be they on premise or cloud based, they should:
• Replicate all your existing processes.
• Integrate with your existing software applications.
• Allow unlimited users.
• Securely controlled access.
• Individual permission access.
The benefits of automating your invoice processing
So, what are the benefits of bringing automation to your invoice processing and how quickly will your investment be realised.
Benefits:
Saving Time & Cost: Receiving, processing, filing, and paying invoices is very labour intensive and therefore costly. Automating your purchase ledger can mean fewer people wasting far less time which can be better employed elsewhere in the business.
Removing Errors: Any manual process can inevitably lead to human error, no matter how careful we are. The problem with mistakes is they can often take a long time to find and remedy, causing employee frustration and potential supplier angst.
Electronic automation does away with potential error meaning transactions are processed smoothly and accurately, first time, every time.
Manage Resources More Efficiently: It goes without saying that if your employees time is not bogged down processing invoices, searching for information and correcting errors, they will have more time available for the positive aspects of your business.
Taking Complete Control: When processing AP invoices in the time-honoured manual way, it is highly likely your information is spread across various media and often in different and unrelated locations. Electronic invoice processing ensures all of your information is in the same place and available only to those with expressed permission, be they in the office or working remotely.
Compliance Reliance: How we maintain data has never been under greater scrutiny and the penalties of failure never more punitive. Electronic document management ensures that both your information and processes are subject to a complete audit trail from the start of the process to its conclusion. Furthermore, you are in complete control as to who has access to your invoices and what administration powers, they have on an invoice-by-invoice basis.
What will be my return on investment?
Clearly any move to invoice automation will involve an investment, it is therefore not unreasonable to question how quickly this will be returned, not only in cost but also the ability to utilise your employee time in a more profitable manner.
Studies have concluded that on average a business processing 2000 invoices per month is likely to see a return on their investment in a little over four months, rising to just over six months for those processing 500 in the same period.
Far from seeing no return on investment, the benefits and savings are extremely rapid, not to mention the amount of regained office space as you move away from traditional storage and the dramatic improvement in employee morale.
To find out how invoice processing automation van bring huge benefit to your organisation, why not get in touch with BPMS and chat to one of our experts.
