PracticePeople In PracticeThe rise of e-billing

The rise of e-billing

Given the power of the Internet to bring together previously separate groups both inside and outside organisations, some of the greatest e-business opportunities are found within supply chain management. A good example of this is business-to-business electronic billing.

Most of the interest in e-billing has focused largely on the consumer as the target for receiving bills electronically. And yet the number of UK utilities offering consumers online viewing of their bills can be counted on one hand.

Research published by UK analyst, Ovum, last year suggested the number of e-bills sent in the UK in the business-to-business environment will reach more than 600 million by the year 2004. This contrasts with less than 100 million e-bills to consumers/households.

But why use e-billing at all? E-billing systems might appear costly at first glance and there is of course a cultural change associated with the new technology.

It’s easy to identify the problems associated with traditional paper-based systems. Most suppliers still invoice by paper, a process that often leads to mislaid and missing invoices and a lack of transparency through the whole process that can make tracking down bills an exhausting process.

Current e-billing technology provides structured reporting on a bill’s receipt and processing, allowing a supplier to be sure a bill has been received and opened. The recipient of the e-bill can then view and print the invoice before forwarding it to a superior or to a different department for approval if required.

Building materials supplier Pioneer concrete last year invested in an e-billing system. Customer service development manager Colin Richardson saw instant benefits.

‘The e-billing system gives a significant advantage to our customers,’ he said.

‘It reduces their costs and streamlines their purchasing processes by automating goods received information from sites and transporting it to their accounts payable department where it is matched to the invoice.

‘Access to this service, by the customer, is available through the internet from any location,’ he added.

Increasing transparency in this way cuts the number of disputes with suppliers and can prevent companies refusing to supply because of unsettled bills.

Analysts expect there will be a gradual transition from paper-based invoice to e-billing as cost savings become more apparent. And decisions about B2B e-billing are currently being driven by finance directors, finance controllers and senior credit managers; proof that e-business decision-making is not confined to marketing directors and e-commerce managers.

Karen Hautz is an e-billing strategist at Microgen.

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