Einvoicing is a complex process with many moving parts that needs protocols and integration with accounting software and ERP systems to operate optimally. It involves a lot of manual processes at first but once implemented correctly it reduces cost, improves cash flow, drives efficiency, and helps keep accurate records.
Smart Communication in einvoicing
Communication is the first step in any business transaction. And, eInvoicing Software is a highly communicative process. It gives you robust communication with your clients and suppliers. It also allows you to change communication channels as per the need of your business.
If you are using an older version of einvoicing, you will find that you get limited communication. With newer versions, you get features like digital signatures and enhanced security.
You get features like the ability to send PDFs, share information, manage communication channels, and assign tasks. You can also get features that allow you to digitally sign your invoices and other documents.
As soon as you receive an invoice from your supplier, it gets automatically verified and posted in your system. You get a confirmation receipt from your client too. This lets you verify if the payment is been made and if there are any discrepancies.
This saves you the effort and resources required to manually verify the payment. It also gives you an early warning if there is a discrepancy in the amount payable. With older versions of einvoicing, you get limited reconciliation capabilities.
Newer systems let you do comprehensive reconciliations and also reconcile accounts payable.
Smart Tracking And Tracing in einvoicing
You want to track and trace the invoice until it is paid. But, do you know if the invoice has been paid and if yes then when? Do you know if the payment has been received? Do you know if the payment is been verified?
Tracking and tracing is one the strongest features of einvoicing. With this, you get to know all the details about the payment including the date, amount, and channel. You can track the payment date, amount, and channel and get notifications about the same.
Thus, you can get an idea of when the invoice will be paid and when you will receive the payment.
Smart Documents Management
All your documents related to sales, purchases, and payments are stored in an online repository. This is a secure digital vault where you can store all your documents. Even your client can send their documents to you through this repository.
This helps you manage your documents better. You can also integrate your documents with your ERP too. This helps you manage the documents better and drive efficiency in the organization. Older versions of e-invoicing systems offer basic document management capabilities.
Newer versions come with sophisticated document management features. Some systems let you manage documents in folders, assign due dates, and add comments too. You can check out Other Related Service: Accounting Software
You send your invoices as soon as the payment is been made. This is how the e-invoicing ecosystem works. This helps you in reducing the time for invoice generation. You can also automate your invoice follow-up. This helps you in getting paid quickly.
With older systems, you may get limited automation features. Newer systems let you do complete automation of the entire process. You can automate the entire invoicing process from the initial creation of the invoice to the payment follow-up.
As mentioned above, there are many benefits of einvoicing. But let’s see the reasons why it is important for your business. E-invoicing is a standard format that is accepted across the globe. It is the most preferred format for businesses.
Thus, all businesses want invoices in this format. But the problem with the paper invoice is that it is very difficult to maintain a consistent format. Every invoice may look slightly different. This may lead to confusion and miscommunication. In case of an e-invoicing system, you get uniformity across the board. Another advantage of an einvoicing system is that it is easy to track payments.
A paper invoice may be misplaced or lost in the paperwork. But an e-invoicing system keeps track and provides a record of the payment. It is also easy to confirm if the payment has been received or not. It is easy to track payments and keep a record of it. This helps you in managing your business and getting paid for your products and services.
Select the right einvoicing solution
This is important before you implement an einvoicing system. You need to find out which solution best suits your business needs. As You need to understand your requirements and find the best solution. You can use an e-invoicing solution like Marg ERP, Zoho Invoice, FreshBooks, or Netline.
All of them are good and let you integrate with your accounting software and ERP. You can test them before you decide on one. Look for the following features before you select an e-invoicing system.
Choose the right software and platform
When you are selecting the e-invoicing system, you are choosing the software and platform that is going to be used. You need to find out what the industry standard is. Then find out which e-invoicing solution is using this platform. This will help you in selecting the right one. You can also check the feedback and reviews from other users.
You can also talk to your peers and find out which einvoicing system they are using. When you are selecting an e-invoicing system, you need to keep in mind the following things. – Ease of Use – You want an e-invoicing system that is easy to use. Your team member must be able to use it without any time. If it is difficult for them, the system will not be used.
Even if the system has some good features but is difficult to use, it will not be used.
– Robust Reporting – You want reporting that is detailed and accurate. This helps you in better decision making and tracking key metrics.
– Integration – You want a system that integrates with your current accounting software. This helps you in maintaining consistent records.
– Security – You want an einvoicing system that is secure. One that is robust against all cyber threats. This will help you in managing client’s data and their invoices too.
Create an action plan
You have implemented e-invoicing and it is time for you to reap the benefits. But, there are chances that you will get distracted by other priorities. This can result in you not getting the full benefits from e-invoicing. You can overcome this by creating an action plan. This will help you in following a process and getting the desired results from einvoicing. Read Other Useful Content: STEPS IN THE SOFTWARE DEVELOPMENT PROCESS
Some of the things that you need to keep in mind while creating an action plan for e-invoicing are –
– Define metrics – You need to define what metrics you are going to follow. You can use the following metrics to measure the success of your einvoicing system. –
– Improve cash flow – This is important because it helps you in managing your expenses and getting the right amount of money at the right time.
It can also help you in managing your inventory better.