An E-invoice is a document with the same value as that of a paper invoice, but it is issued and received in an electronic format. In simpler words, it is the digital version of an electronic invoice. This type of digital invoice speeds up the sales /return process and also guarantees validity with the same attributes of a traditional invoice.
E-invoicing solutions can help attain new levels of invoice processing performance as they can also eliminate errors, reduce supplier inquiries, speed approvals and inquiries.
7 Major Advantages at a Glance
Electronic Invoice benefits both suppliers and buyers by helping in the following cases:
- Reduction in costs
- Facilitation of automation
- Shortening of payment cycles
- Enhancement of compliance
- Prevention of errors, losses, and fraudulent activities.
- Improvement in supplier/customer relationship.
- Reduction in carbon footprint.
Benefits of Electronic Invoice for Suppliers:
1. Better Cash Flow Management
While receiving paper or PDF invoices from the supplier, the buyer has to make sense, route, re-key, and resubmit the invoices for their approval. This entire process is time taking. Another possibility is that the invoices may get lost.
Similarly, the e-invoices are instantly accessible on the buyer’s system and can easily be routed and authenticated much faster. As a result, the payments are submitted on time which improves the cash flow management.
2. Deteriorated Costs
For the suppliers, the selection of e-invoicing aids significantly in the reduction of costs associated with printing, storage, processing, and hence the delivery of the traditional paper invoices. The increased and enhanced accuracy means a fewer number of customer complaints and thus lesser customer service calls are required.
3. Lesser Number of Customer Disputes
The traditional invoice disputes and rejections are quite costly and also time-consuming for resolution and thus can lead to late payments. With e-invoicing, the data from the supplier’s accounts receivable system is sent to the customer’s account payable system directly and straightforwardly. This reduces the chance and risk of errors caused by the data re-entry. Hence, the potential of invoices being rejected is decreased instantly.
4. Better Customer Satisfaction
Now the suppliers can provide a higher level of customer service by allowing the faster process of e-invoicing. The result is a higher level of customer retention and engagement with your business products. More and more customers will stay loyal to your business and thus you will not fail to impress them.
Benefits of Electronic Invoice for Buyers
1. Improved Productivity and Automation
For the old and traditional paper or PDF invoices, the documents must be stored, sorted, and re-entered into the accounts payable system. These data–entry steps are much time-consuming and prone to error. Whereas the Electronic Invoice system eliminates the need for data entry or re-entry manually. This results in decreased workload and a higher level of productivity.
E-invoicing enables Accounts payable departments to automate the validations of invoices before they are sent for approval. These validations make sure that all calculations about VAT or GST amounts are accurate.
Every type of validation is automatically performed with e-invoicing. Since the data entry and validations are automated, there is less need for the buyer’s staff to confirm the reception of invoices on the supplier‘s end.
There is also the facilitation of a supplier portal which enables the tracking of the status of invoices as well as the payment approval information.
2. Decreased Costs
The cost is overall decreased by allowing the cost savings of 60-80 %. Thanking the e-invoicing system eliminates the need to perform the manual data re-entry.
3. Improved Supplier Relationship
As a result of utilizing electronic invoices, the relationship between the supplier and customer is improved and enhanced. Hence the business becomes easy and smooth along the process of the supply chain.
Benefits of Electronic Invoice for Both Suppliers and Buyers
Carbon Foot Print
Electronic Invoice eliminates the need of utilizing paper. This is such a great feature as electronic invoices are extremely environment-friendly. No energy is wasted in producing the paper and thus the trees cutting is avoided.
The global warming effect is controlled if everyone utilizes the electronic invoicing feature. Moreover, your environment will stay green and natural and you can expect more oxygen levels in the air thus reducing pollution.
Although there is much software that is implementing the electronic invoice, SMACC is the software of its peculiar kind. Recently this year, SMACC has intended to introduce the feature of electronic invoices and thus facilitate its users so that the environment stays healthily green and freshly oxygenated. Also, the chances of fraudulent activities will be minimized and customers and suppliers will happily shake hands on the joint venture of cooperation and coordination. Hence you cannot ignore the awesomeness SMACC presents to its users with flawless accuracy and efficiency in 2021 (the post-pandemic time).