When considering a technology with immense future potential, while also firmly entrenched in the present, e-invoicing stands out as a compelling choice. The capacity to seamlessly transmit and receive invoices directly between accounting systems, thereby eliminating the reliance on error-prone PDFs sent via email, presents a host of thrilling advantages.
E-invoicing is currently at varying stages of adoption worldwide, with certain governments either mandating its use or actively supporting it as an integral part of the invoicing process. Nevertheless, the true extent of its capabilities remains largely untapped, particularly when envisioning its integration with other cutting-edge technologies such as artificial intelligence, blockchain, smart payments, and the ‘Internet of Things’.
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The real meaning of zero-touch
After a surprising surge in coffee orders one Thursday morning, JB, the owner, finds himself with only one liter of milk left by 11 am. He promptly opens his supplier’s procurement app and begins a swift comparison of milk wholesalers in Melbourne, considering both price and delivery time. Supplier 1 offers a rate of $2 per liter but won’t deliver until 2 pm. In contrast, Supplier 2, albeit pricier at $3, promises delivery within just thirty minutes—ideal. JB selects ‘accept’ and returns to crafting coffee for his patrons.
Thanks to cutting-edge payment technology, the transaction is finalized before JB even places his phone on the counter. An e-invoice is automatically generated and recorded in the ledgers of all three parties involved. Payment details are seamlessly exchanged, obviating the need for a month-end PDF invoice entry. JB doesn’t even have to sign anything before the delivery driver restocks the fridge and departs.
Before adopting these innovations, JB was burdened with manual bookkeeping, relying on paper and PDF documents. Consequently, he frequently forgot tasks, paid suppliers late, and struggled to reconcile his accounts after a long day at work.
Upon consulting with an advisor who spearheaded the digitization of his business, JB integrated his accounting software with his point-of-sale system. This integration extended to various apps, including those for stock management, employee scheduling, and payments, culminating in the establishment of an e-invoicing arrangement for inventory items, like milk. This transformation made JB’s business operations significantly smoother and more efficient.
The next frontier of e-invoicing
To truly appreciate what potential e-invoicing technology could unlock more broadly, it’s worthwhile really understanding what underpins it: the Peppol network.
Peppol is a secure, global network that simplifies the exchange of electronic documents. It is managed by a non-profit organisation that standardises the way information is structured, so you can send documents (such as e-invoices) directly into other registered software systems, even if your customer or supplier uses a different system. It’s a far cry from current paper and PDF invoicing, which is highly error-prone and cumbersome.
So, what sort of future state could reasonably exist if futuristic technologies were built to work together? Let’s picture another scenario for JB.
When stock got low, sensors in JB’s milk fridge would automatically alert a small business platform that an order for full cream and skim milk were required. The software would then display a list of suppliers with availability, delivery times and prices (and even make a recommendation based on previous history of milk usage).
JB would decide on the best price, and the software would send off the order. Once the milk arrived, a sensor would identify that it had been placed in the fridge, triggering a confirmation to the supplier who could then issue the e-invoice. Over time, the artificial intelligence built into these tools could analyse JB’s sales, and proactively adjust the orders to work around the peaks and dips.
Looking to the future
While the situation described may seem hypothetical, e-invoicing has become an undeniable reality. Governments worldwide are making substantial investments in e-invoicing and actively promoting its adoption, especially in countries like Australia, New Zealand, Singapore, and the UK.
Embracing e-invoicing offers immediate advantages, such as enhanced efficiency, cost reduction, and accelerated payment processing. This isn’t just beneficial for your business or practice today; it also serves as a crucial initial stride towards embracing upcoming technological advancements.
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