Winning with Electronic Invoices

Electronic invoices offer clear and measurable benefits and are supported by Conexxus EB2B Working Group, but there’s a need for more supplier engagement.

By Ed Collupy

Store managers, cross functional retail headquarter teams, merchandise and consumer packaged goods suppliers, back-office solution providers, and technical standards all have something in common – what is it?

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They can all bring about one of the best wins when data exchange between the retailer and supplier is automated. Melanie Squires, president of sales & operations of Series2k, tells the story of one of her c-store chain owners receiving hugs from a store manager for months after implementing a new simplified process handling invoices. It reminded me of the same wins the store managers of a much larger chain of stores expressed to my team – providing them more time to spend on store operations, training others, as well as interaction with customers. As an IT leader wins from store managers were an important measure of success and when vendors joined in sending their invoices electronically, using the Conexxus NAXML standard, the momentum those wins caused was phenomenal.

The implementation of the standard has been made easy thanks to the efforts of the Conexxus EB2B committee and back-office system providers. The committee provides support to retailers interested in learning more and have advocated for the adoption of the standard by merchandise vendors. Here’s a link to a Quick Reference Guide the group wrote: https://www.conexxus.org/system/files/EB2B_Committee/BenefitsOfElectronicFileExchange-ConexxusQuickReferenceGuide.pdf. Most back-office systems have built-in capabilities ready to import, not only electronic invoices, but payment advice, item/price files, item/promo files, predelivery notices and purchase orders files as well.

The file imports can come in many formats, but at their root are standards. Charity McGill, CEO of Deep Water Software, listened to store operators and heard them say, “minimize the change” as a new invoice process is brought about. With her import approach, store managers simply scan the invoice the delivery driver leaves at the store and in the background the information on the paper invoice is imported into the back-office system using the NAXML standard since it has the “most likely accuracy” with credits, discounts, etc. Other c-store companies have their category managers and/or price book teams reach out to wholesalers and direct store delivery suppliers and request a file to be transmitted over a secure network; many of the suppliers will ask what system and/or file type (e.g. NAXML, EDI, .xls) is desired and get to work on what becomes a win for them too.

In her role as a sales consultant for The Scan Group, Kathy Williams encourages her retail customers to reap the benefits from using an electronic invoice process. Based on experience she and other solution providers I spoke with recently see retailers saving a minimum of 15 minutes per invoice. Then add on the benefits that come from improved inventory control it’s an even bigger win. For c-store operators/owners to move to item level inventory, Squires said receiving invoice data electronically is a must – “time is of the essence” as is an “attention to detail” to ensure inventory accuracy.

During recent store tours with the National Advisory Group’s Young Executives Organization (YEO) the number of new and varied products I saw on store shelves to meet the local needs of that store’s customers was amazing. This “rebirth of niche items and vendors,” according to McGill is another driver for c-store operators looking to stay competitive and believes importing versus manually keying vendor data is important in managing this change since it adds to the number of invoices that need to be handled.

The benefits are so powerful to retailers that Adam Wood, sales manager at Red River Software, hears from retailers that it’s “all or nothing” – they want all their vendors to provide invoice data that can be imported, not just some of them. Almost all of Wood’s customers receive an electronic invoice from their major wholesaler but not from their other merchandise vendors and some have turned to the Deep Water solution as an alternative to achieve a standardized process.

Unfortunately, what I heard without exception from all the people I spoke to is the lack of support small c-store operators receive from local distributors and even suppliers backed by a major Consumer Packaged Goods company when it comes to receiving electronic invoices. The industry is well served by Conexxus standards and those that adopt them. Certainly, the Conexxus EB2B Working Group and Back Office solution providers are advocates and supporting retailers with implementing the electronic invoice process yet could have even more wins with stronger merchandise supplier support.

Ed Collupy, executive consultant at W. Capra Consulting Group can be reached at [email protected] and be sure to visit www.capraplus.com for more retail technology and business insights. Collupy has IT leadership and business team experience providing strategic, operational, and project leadership to retailers, emerging businesses, and technology companies.