Many manufacturers overlook invoicing without realizing how much it is costing them. When you think about it, the invoicing process is literally how organizations take in money, so it makes sense to make it as efficient as possible (read our previous blog on how invoicing can also increase revenue).
Traditional Invoicing Methods are Expensive
Invoicing is an expensive problem. 90% of invoices are done in paper form, meaning they require manual entry or digitization through scanning (SupplyOn). The Institute of Finance and Management (IOFM) found that the average cost for organizations handling up to 100,000 invoices per year is about $610,000 when they process each invoice manually. For growing organizations that process 20,000 or fewer invoices, the cost is a staggering $15.97 per invoice (Kofax). That can be over $300,000 a year! Your ERP can transform this outdated invoicing system, making it easier and more reliable for you and your customers at a fraction of the cost.
Automated, Paperless Invoicing
Moving to automated, paperless invoicing through your ERP increases accuracy, consistency, and convenience. Overall, there is less labor involved for your employees and your clients. No one needs to handle sending out or receiving the invoice or the payment. Instead of having your team dealing with stamps, the system can automatically send email reminders to the customer when an invoice payment is due, which the customer can submit online with an e-signature through secure channels. An automated, pre-designed receipt can then be emailed to the customer. The whole process can be completed in minutes (rather than waiting weeks for payments that “got lost in the mail”), and there is a clear digital record for both parties. Making the process fast and simple for customers naturally leads to a reduction in DSO (Days Sales Outstanding) for invoices, meaning your business will be receiving payments faster and have more money on hand. You can trust that invoices are going out correctly because your team only needs to oversee the practice and there are far fewer opportunities for human error after the setup phase. To ensure that your invoicing is set up the right way the first time, work with a trustworthy ERP consultant like Datix who will take care of every step of process from start to finish.
Automated, paperless invoicing is better for you, your customers, and your wallet. In fact, paperless functionality improves areas beyond invoicing and can transform your manufacturing methodology through your ERP.
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