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Cutting the long wait for payment
31 January 2010 By Pat Leahy
As cashflow slows for businesses, and banks continue to tighten credit facilities, companies everywhere are having to wait longer to get paid.
One firm claims it can tackle those issues with a facility, not just to cut invoicing costs, but to reduce the waiting period for payment.
‘‘The key driver for many of our clients is the reduction of debtor days," said Gregory Duffy, chief executive of Kildarebased One Posting, which operates an electronic invoicing system. ‘‘Typically, they’re experiencing a reduction of three to four days."
Users of the One Posting facility are also making considerable savings on their invoicing operations, according to Duffy. Ballygowan, for instance, has cut the cost of its invoicing by half in the six months it has used the service.
The One Posting system was developed by Sentrio Technologies, a company offering a wide variety of online and electronic services to business, including accounting services. Duffy, an engineer with a background in business, founded Sentrio in 1995.
After two years of development work, One Posting went live last year, and currently has about 5,000 registered members.
Growth is quick, as companies and businesses which receive electronic invoices often join the system themselves. Many cite the attraction of standardising all their invoices at a stroke, according to Duffy.
‘‘We tend to get a very high rate of customer acceptance once it’s offered," he said. ‘‘It’s driven by the ease of use, and we would expect our numbers to double in 2010."
The system uses ‘cloud’ technology, which means it is hosted on the internet and does not require large IT investment. Once registered with the system, customers can access statements, invoices, delivery dockets and orders and other account activity at any stage.
While practically all invoicing is expected to be done online in the future, the move to a fully electronic system occurs at a different pace for different businesses, Duffy said. One Posting operates a postal and/ or faxed invoicing system for clients that prefer it, although Duffy said that many firms tended to move to the electronic system before long.
‘‘People can opt in or out as they wish," he said. ‘‘We encourage people to go online and, like internet banking, we find that, as soon as they’ve seen it work, they’re happy to migrate to that system. But not all are ready or willing to go online immediately, so you have to keep the ’multi-channel’ offering." Once businesses migrate totally to the online system, they no longer have to keep the detailed paper records that clog up back offices with lever arch files. All documents are stored securely and electronically for six years to comply with Revenue guidelines.
One Posting will shortly announce the addition of Glenpatrick Spring Water as a customer. John Young, managing director of Glenpatrick, described the switch to electronic invoicing as ‘‘a no-brainer’’ that had multiple benefits.
‘‘The environment is top of Glenpatrick’s agenda, and we do our utmost to reduce our carbon footprint," Young said. ‘‘We have already more than halved our number of paper invoices."
He cited one feature of the One Posting system as a particular advantage - it informs the company if any of its customers have not accessed their invoices. The fact that invoices are sent within minutes, rather than days, also speeds up the entire payment process. Suppliers can choose to alert customers by e-mail or text message to let them know that there is activity on their account.
Another One Posting customer, Alan Carroll of Waveform Solutions, a mobile and data capture company, said that savings were immediately noticeable.
‘‘It’s early days for the installation but already, we are seeing the benefits," said Carroll.
‘‘Our stationery and postage costs have been reduced considerably, and we have freed up time for our administration staff."
One Posting’s Duffy is predicting further growth, at a time when many other companies are being forced to scale back.
‘‘There’s clearly a lot of momentum," he said. ‘‘We will start tolook toBritain in the future but, for the moment, our focus is on the local markets."
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