Breakdown of e-Invoicing Benefits

Recently e-Invoicing seems to be on many CFO's minds. The ROI from converting in-bound paper invoices to electronic invoices is solid and reliable. There are many reports, but let me just share one today.

I came across a report by Author B. Little on in-bound electronic invoices that broke down the cost benefits of e-Invoicing and thought it would be valuable to share. The report was in Euros, but the points remain valid.

Costs of in-bound paper invoices:

• Mail processing - Euro 0.90
• Data input - Euro 1.40
• Approval - Euro 5.40
• Payment - Euro 2.80
• Archiving - Euro 1.50
• Handling disputes - Euro 1.80

Costs for in-bound electronic invoices:

• Mail processing - Euro 0
• Data input - Euro 0
• Approval - Euro 2.0
• Payment - Euro 1.1
• Archiving - Euro 0
• Handling disputes - Euro 0.90

According to Arthur, paper invoices average Euro 13.80 to process, while electronic invoices only cost Euro 4.0. I question the Archiving numbers as even electronic invoices must be archived according to specific rules in order to be compliant with government mandates and that always involves some costs, but never the less, there is substantial savings.

If your company processed 1 million in-bound invoices yearly the savings from converting from paper to e-invoices would be Euro 9.8 million per year according to Mr. Little. Of course there are costs and investments to be made in order to convert from paper to electronic, but there is certainly room for investments in that 12 month ROI.

Last year SAP invested in Crossgate, an EDI, B2B and e-Invoicing exchange for SAP users that operates on NetWeaver PI. Using NetWeaver PI, SAP users can now integrate and activate an on-demand e-Invoicing service that is SAP-centric and utilizes NetWeaver PI on both ends..

If you would like to discuss this topic in more detail please email me.

For more information on e-Invoicing read here:

• http://b2b-bpo.blogspot.com/2009/08/converting-paper-invoices-to-electronic.html
• http://b2b-bpo.blogspot.com/2009/07/benefits-of-e-invoicing.html
• http://b2b-bpo.blogspot.com/2009/06/saving-costs-through-e-invoicing-both.html
  
  ************************************************
  http://b2b-bpo.blogspot.com/
  ************************************************