Glen Jewell, Sales Director at Blue Rock Systems explains why you should consider the less obvious areas of your business when looking for ways to increase efficiency and profitability.
In today’s merchant software solutions sales order processing and sales invoicing has been finely tuned. It is only natural to focus attention on high transactional areas and the processes around them. Some of these processes take up valuable administration time and resources and ignoring them could be a threat to the net profitability of the business. However, there are some less obvious areas of the business that could really benefit from the smart technology that is now available for forward-thinking merchants. Below are some examples to consider.
Purchase orders create a sizeable amount of administration for merchants of all sizes. To address the difficulties of manually keying invoices (and storing paper copies) companies historically invested in Electronic Data Interchange (EDI). This enabled suppliers to send electronic documents to a company via a 3rd party, who would validate the sending and receiving process.
While this is better than a manual system, your suppliers may be operating different EDI platforms. The traditional EDI setup can be perceived to be both costly and time-consuming when you are receiving invoices from many suppliers operating on different EDI platforms and standards. There is also the possibility of being charged by third-party EDI specialists (known in the industry as value added network providers) for the transactions that have taken place.
Many UK merchants have relationships with buying groups to leverage an array of benefits. Modern technology can offer a solution to these challenges; the National Merchant Buying Society (NMBS, a Blue Rock Systems customer) makes it possible for members to receive a single purchase invoice file, which contains all the invoices for that merchant from all the suppliers that the buying group trades with. The merchant will still need software that can import these files and handle errors/exceptions, but it will improve the process for the recipient and prove to be a cost-effective solution.
However, there will be suppliers that don’t trade via buying groups and cannot send their invoices by EDI. They will either send you paper invoices or email through an image (normally as a PDF). Technology such as Optical Character Recognition (OCR) can either recognise text in a physically scanned image or enable us to convert the PDF into text. Once converted to text then these can follow a similar process to EDI or receiving a file from the buying group.
Not only does modern software enable you to gather this data but it can also verify the purchase entry against a valid purchase order and delivery note. You should be able to set tolerances and rules to deal with items that may be a few pence different in price. Ultimately, if the entry falls outside of your set tolerances or there is an error then a human will need to get involved; but as you perfect the process and tune your tolerances/settings then the level of failed invoices will reduce.
A further benefit with this solution is that the images along with associated financial data can be stored automatically. This can then be sent on to the customer either by email or accessed via an electronic document portal on the web. It also reduces the amount of filing needed and makes retrieval of affiliated documents very simple.
Outside the box
To quickly mention a few other areas of the business that might benefit from an efficiency overhaul. If you employ field sales staff who submit expenses each month, take a moment to calculate the time it takes to collate receipts, fill in forms and send to accounts, who will then process the claim. There are apps available that can improve on this process, allowing staff to photograph their receipts which are converted to text and posted directly to the ledger (in an approved or unapproved state). In a modest organisation the use of expense software can save a couple of weeks a year and provide valuable analysis.
Your customers might place many calls a day to the accounts department; querying invoices, asking for proof of deliveries, receive statements or wanting to make a payment to their account. Some businesses (typically smaller family run setups) do not have time to do that during the working day and would love to be able to answer those questions during the evening or weekend. With a secure customer web portal you can do this, and promote some products to them during the process.
Overall, improving efficiency is applicable to all areas of the business, not just the areas which are the most obvious. Spending a little time thinking about how to improve the overlooked areas of your business could result in an innovative solution; ultimately reducing threat to the bottom line.