For Accounts Payable departments which are processing thousands of transactions every day, while it’s helpful that a high percentage of transactions are automated using ERS (Evaluated Receipts Settlement), where no invoice is required to generate payment), EDI (where invoice information is received electronically using defined formatting standards), or Purchasing Cards (where purchases are made using a credit card), many transactions don’t fit cleanly with these structured alternatives. One approach that is increasingly popular is to reduce paper invoices by having suppliers complete the data entry for outlier transactions using a supplier portal.
iPollingTM Results Review
Recently, the Global P2P Manager at a Peeriosity member company with $10 Billion USD in annual revenue created a poll using the iPollingTM technology to better understand the approach peers take to accommodate invoice submissions using channels other than EDI. While no companies require the supplier portal as the only alternative, 10% of companies require the transaction to be paperless, either using the supplier portal or sending the invoice by e-mail. 54% of member companies use a combination of supplier portals, e-mail, and paper. 36% indicated they don’t have a supplier portal option, requiring them to use some combination of e-mail and paper. No companies responded that paper invoices were the only alternative. Here are the details:
The next question in the poll examined the approaches companies take to encourage adoption by suppliers to using a portal. The most popular approach, at 48%, is to offer the portal free of charge for invoice submission. 52% of member companies go a step further, with 26% marketing the positive impacts to the supplier (e.g., improved processing times, no payment delays), and 21% rejecting paper invoices under certain circumstances to force compliance.
Here are a few of the comments from Peeriosity members:
- To encourage suppliers to submit electronically, we tell them processing times are improved and payment will be received sooner.
- We require most suppliers in the US to log into our portal. Exceptions include utilities and government entities. Outside the US we use paper, but allow emails for certain vendors, and we also offer Tungsten as a solution (where allowed).
- Not only do we offer the portal free of charge, but we emphasize that this can strengthen the partnership by improving the invoicing/payment process for both parties.
- We encourage by highlighting the efficiencies of e-invoicing (no lost invoices, faster be ready to pay).
- Our Asian vendors love the supplier portal and upload all of their invoices through the supplier portal. We see significant progress in e-invoicing without an added effort in communication or requirements.
- We implemented it in February and our portal is also free. We began rejecting paper and e-mailed invoices in July for vendors that had already registered and are accepting POs through the portal. Eventually, we’d like to get all who qualify onto the portal, but it takes some planning & effort!
Achieving superior performance in Accounts Payable requires quality and accuracy at every step of the P2P process. It also requires invoice information to be submitted using low-cost channels that are efficient with little to no effort required by Accounts Payable staff. Implementing, and then encouraging, the use of supplier portals can be an effective approach for transactions that are not otherwise easily automated.
Does your company have a supplier portal that provides access for vendors to submit invoices? If yes, what approaches do you take to increase the volume of portal transactions?
Who are your peers and how are you collaborating with them?
“iPollingTM” is available exclusively to Peeriosity member company employees, with consultants or vendors prohibited from participating or accessing content. Members have full visibility to all respondents and their comments. Using Peeriosity’s integrated email system, Peer MailTM, members can easily communicate at any time with others who participated in iPolling.
Peeriosity members are invited to log into www.peeriosity.com to join the discussion and connect with Peers. Membership is for practitioners only, with no consultants or vendors permitted. To learn more about Peeriosity, click here.