All posts by : Andy Lewis

E-Invoicing Presents Opportunities for Businesses to Save

Invoicing is an important process in any business. Unfortunately, it is also a laborious process that requires accuracy. With technology advances, businesses have tried to use various means to ease the invoicing process. Some outfits send scanned invoices; others might transfer PDFs through email; and some still use manual invoices. In this technology age, many businesses are choosing to automate functions in a bid to increase overall business productivity and efficiency. E-invoicing is a technology that promises to help entrepreneurs add value to their businesses. 

What is E-Invoicing?

E-invoicing is the exchange of an invoice between a buyer and seller using an integrated electronic format. This allows the buyer to pay online through a card payment, direct debit, or another option after receiving the e-invoice. 

E-invoicing is not a new technology; it is already used by large scale businesses and governments. Some governments have mandated the use of e-invoices from their suppliers and even for taxpayers. These programs have been running onsite, making it expensive for small and medium businesses (SMB) to use. Another challenge for SMBs has been dealing with multiple providers who have different platforms and technologies. This is a challenge because it requires a business to support extra business processes when sending or receiving invoices. 

However, the rise of cloud computing and Software as a Service (SaaS) technologies has become an enabler for SMBs to implement e-invoicing. 

Making e-invoicing available as SaaS eliminates complicated system installations and integrations that have previously been a challenge to SMBs. The SaaS systems come with features that allow users to automate the invoicing process, send reminders, accept online payments, and generate reports, among other things. 

Benefits of E-Invoicing

Here are some reasons that businesses are moving to e-invoicing: 

• Eliminates the manual process of sending invoices between a buyer and seller.
• Prevents human error with the use of a template. The automated e-invoice ensures correct data is used with a validation process. This ensures there is no mistyped information, no data entry errors, no double entry, missed details or wrong data. Therefore, it improves accuracy.
• Has lower processing costs, since it helps to cut down on administration costs and printing invoices. It also saves a business from the task of sending emails back and forth concerning an invoice.
• Maintains a more predictable cashflow as e-invoicing facilitates the seller receiving payment faster.
• Enables ease of tracking invoices as you can track and trace the entire document journey. This means better accounting.
• Offers enhanced convenience. Businesses create a different number of invoices depending on their transactions. E-invoicing provides a convenient way to store the invoices and easily retrieve them when needed.
• Saves on time so users can concentrate on other business activities. There is no need to waste time looking for client information and entering data every time a user needs to send an invoice.
• Improves the accounting process. When a business integrates e-invoicing with an accounting system, the invoicing function is faster and easier to handle.
• Enhances invoice security and guaranteed delivery. There is no risk of invoices getting lost in the mail or landing in junk email. Encrypted file transfer and digital signatures are used to enhance security.
• Uses real-time processing, which allows one to view the live delivery and processing status of an invoice.
• Is accessible from anywhere via remote handling. This makes it possible to send an invoice anytime and from anywhere as there is no need for printers or scanners.¬†

Conclusion

The business environment is becoming increasingly competitive, and the adoption of technology that automates processes can only help. E-invoicing provides an opportunity for business owners to effectively use their time on growing their business instead of spending it on a labor-intensive administration process. This service also helps SMBs align themselves with large corporations. 

Finally, as with any technology, business owners should take time to research which e-invoicing service provider will best serve their unique business needs. 

How Businesses Can Hedge Against Increasing Inflation

Inflation is on the rise. According to a recent Economic News Release from the U.S. Bureau of Labor Statistics (BLS), the Producer Price Index for final demand grew by 1 percent in March. February saw “final demand prices” grow by 0.5 percent; January's final demand prices increased by 1.3.

According to the BLS, the Producer Price Index (PPI) consists of many indicators and evaluates the mean difference over a period of time for the “selling prices received by domestic producers of goods and services.” In other words, PPI is a way to gauge how much manufacturers and similar businesses face in increased costs due to inflation.

This inflation gauge takes a broad survey of approximately 10,000 unique manufactured items and the amount of inflation businesses face. The BLS’ PPI measure looks at items produced by fisheries, food growers, miners, manufacturers, etc. It also includes 72 percent of production of the service sector, as the 2007 Economic Census found.

Hedging with Futures 

One way to reduce risk is by hedging. A popular example is with futures contracts. Much like buying an insurance policy, futures contracts can reduce the impact of a negative event, such as a spike in commodity prices.

If a company is worried about the price of oil for their planes or coffee for their cafes, they can enter into a futures contract to buy a designated quantity of that particular commodity at an agreed-upon price, with the ability to exercise it on or before the expiration date.

With a futures contract, a company can better plan its budget based on the contract's parameters and the cost of the contract. If the price of the commodity rises in the future due to increased demand or limited supplies, the business can save money by taking delivery of the particular commodity at the originally agreed upon price through the futures contract.

Since the goal of hedging is to protect against losses, it is important to weigh the cost of the futures contract. If the price of the commodity falls for the above-mentioned futures contract example, the company would still be forced to buy the commodity at the contract's price, which would be a poor investment. If, however, it sells the futures contract before its expiration to avoid receiving the physical commodity at a poor price, that would lead to a loss. Having a contingency plan to reduce losses in futures contracts is always a good part of a hedging strategy.

Negotiate with Suppliers

Much like businesses enter into specified timeframes with suppliers, companies can do the same with their purchased supplies to provide more predictable prices. When the PPI measurement is used, the purchasing company can contract with its supplier to settle on the initial product's price, and how price fluctuations will be determined going forward. Since the PPI is released monthly, the price can adjust accordingly (decrease or increase, depending on the PPI) for the supplier and purchasing company. It can be re-evaluated every three, six or 12 months, for example.

While there is no predicting the future and if and how much commodity prices may rise and impact businesses, the more tools that businesses have to mitigate increased costs, the more likely they are to survive rising inflation.

Sources

https://www.bls.gov/ppi/ppifaq.htm

https://leg.mt.gov/bills/2007/fnpdf/HB0204.pdf

https://www.bls.gov/news.release/ppi.nr0.htm

Strategy of Time Clock Rounding

This article discusses the business strategy of time clock rounding in order to ease payroll calculation and prevent employee time theft. With many employees still working from home, these practices are important to review frequently. Legally, if you participate in rounding, there are three approved rules that you must follow. One is the 15-minute rounding, the second is five-minute rounding, and the third is six-minute rounding. Be sure to check out this article for more information and details on what practice is best for your business!

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Remote Work Policies That Last

This article discusses how the coronavirus pandemic has shifted the way many industries are conducted on a day-to-day basis. Specifically, teleworking has become the new norm, and it is important to have proper procedures in place in order to promote efficiency for your business. A few tips include communicating and being transparent with your employees, real estate agreements, and technology utilization. Be sure to check out this link for more information and details!

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The Benefits of Work Management

This article discusses the definition of work management and how it differs from project management. Specifically, work management “is the oversight and supervision of all individual and team tasks and task lists within one project or across a company's operations.” The concept of work management can include pieces of time, resource, process, and client relationship management. No matter your industry, being both efficient and effective in the workplace can prove to be very beneficial. Be sure to check out this link for more information on work management and how it can be implemented within your business.

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Tech Trends for Small Business to Watch in 2021

This article discusses and outlines seven different technology trends to watch within the small business industry. Specifically, these trends are designed to improve software, automation, and machinery functionality. Artificial intelligence-powered chatbots and CRM, streamlining HR work, 5G, and voice-activated payments are all expected to have a significant impact. Be sure to check out this link for the full list and more information!

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Credit and Debt Collection Strategies Your Business Can Implement

This article discusses and emphasizes the importance of having and implementing the most efficient debt collection process possible. Providing services to your client before payment is often a risky but necessary part of doing business. Implementing strategies such as invoice date, contact information, and obvious total invoice values can help ensure that your business gets paid. Be sure to check out this link for more information and details on some of the best practices for your small business!

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Estate Planning Techniques During COVID

This article discusses how the COVID-19 pandemic has resulted in low interest rates and depressed asset values, creating a very unique opportunity for estate planners. Specifically, this article outlines five different strategies to consider utilizing during this time. For example, annual gift tax exclusion, gifting interest, annuity trusts, and intra-family loans are all topics that should be considered. Be sure to check out this link for more information and details!

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Keeping Your Company Grounded During a Crisis

This article discusses and emphasizes the need for all businesses to be able to adapt and pivot in the right direction, especially during a crisis like the Coronavirus pandemic. Some tips that are outlined are the ability to strategize quickly, supporting company morale, staying grounded, and preparing for a future crisis through risk management. No matter your industry, these tips can be very beneficial if implemented in the proper format. Be sure to check out this thing for more information as well as the full list of tips!

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