Global report estimates great growth potential in electronic invoicing
The next wave of e-invoicing will aim at value creation along the supply chain
Electronic invoicing is ready to be catapulted to the next level.
This is the conclusion of the annual global market research report authored and published by Billentis and sponsored by OpusCapita. The report estimates that over 42 billion of the 500 billion invoices being issued globally will be exchanged paperlessly in 2015. The annual growth rate for e-invoicing worldwide is around 20%.
“In Europe, we have seen that organizations’ objectives for implementing electronic invoicing have expanded from pure cost and process efficiency. E-invoicing is now considered as an enabler, and the main driver in the progress is the aim to promote the operating capabilities of all the parties in the supply chain and to maximize the value of trading relationships,” says Ahti Allikas, Solution Director of O2C Services at OpusCapita, commenting on the results.
“Optimizing working capital and strengthening cash flows are now also high on the agenda of both the purchasing organizations and their suppliers. This emphasizes the importance of electronic and automated – and thus fast and visible – processes in purchase-to-pay and order-to-cash, in which invoices are the core elements.”
The Billentis report highlights the role of small and medium-sized enterprises in e-invoicing’s next evolutionary step. From OpusCapita’s perspective, the growing interest in supply chain financing and dynamic discounting, for instance, provide a natural incentive for the smaller suppliers to begin issuing e-invoices to their purchasers. Electronic invoicing and efficient invoice management are usually prerequisites for participating in such financing programs.
Adaption from government initiatives to B2B sector is crucial
The market penetration of e-invoicing in Europe presented in the Billentis report shows 40% coverage in the Nordic Countries and 15 to 40% coverage in Central and Southern Europe and Great Britain in the business-to-business and business-to-government markets.
New EU directives, which will enter into effect at the end of 2018, aim for the development of a European standard for e-invoicing in public procurement. The report expects the directives to have a tremendous impact, affecting over 100 000 public administrations and agencies across Europe.
“Government initiatives will have an impact, for sure, but a new format will only be able to widely increase cross-border capabilities in e-invoicing if it is adopted in the B2B segment as well. The B2G market is typically very local. European platforms still feature strong local traits even though the public sector has, for a long time, been active in promoting these issues,” Allikas says.
Some markets are on the verge of mass-market adoption of e-invoicing. As the proportion of e-invoices rises, it will become even more relevant to pay attention to the handling of the remaining paper invoices in the companies’ accounts payable processes as well.
“The capability for multi-channel invoice exchange will remain a crucial element of efficient financial management in the international operating environment. The role of service providers will be pivotal in enhancing interoperability in the changing markets,” Allikas estimates.
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Ahti Allikas, Solution Director, O2C Services, OpusCapita