Get ready for the eInvoicing revolution

Darren Smith explains how eInvoicing saves businesses time, improves billing accuracy, and boosts both efficiency and security.

When most business owners think of invoicing – extra admin, paperwork, and additional use of the team’s time may be the first points to mind. Add to this the chance of human error, the increasing prevalence of email scams, and having to chase late payments, and invoicing can be a major headache.

While the process can be time-consuming – with MYOB’s research showing that one-in-five SMEs spend six hours or more on invoicing – billing for services or goods delivered is ultimately what brings in the revenue that keeps local businesses running.

According to MBIE, around 280 million business-to-business invoices are exchanged on average each year in New Zealand – that’s a lot of money flowing through our economy and boosting the cashflow of our local businesses.

So, how can we not only safeguard this flow of money, but accelerate it even more and remove some of the headaches that often come with the current process?  Enter – eInvoicing.

Busting the assumptions

To clear up a classic assumption that just won’t budge – emailing a PDF or other type of digital document that you’ve had to populate with the relevant customer and job information is not eInvoicing.

So, what is it? eInvoicing works by letting businesses exchange invoices directly using their accounting software, like MYOB, where it’s built right into some of our solutions for straightforward, seamless access. It connects both parties’ invoicing systems for immediate payment and easy, secure processing. No paper, or manual handling, or even emails.

eInvoicing also ensures more accurate and complete data for your business, empowering business owners and managers to make better informed decisions based on up-to-date insights, and therefore more control over cashflow.

Preparing for take-off

Hearing the echoes of ‘where do I sign up?’ we’ve rounded up a checklist to help SMEs considering the move to eInvoicing plan their next steps.
 

1. Consider your current digitisation levels

It’s no secret that many SMEs were motivated to take greater strides around their digital transformation by the advent and impact of the COVID-19 pandemic – but whether it was over the past couple of years or well before then, if your business management operations have been part of your digital transformation, adopting eInvoicing is a good progression.

However, for businesses still heavily relying on paper files and excel sheets to keep track of finances, it’s worth chatting to an adviser or accountant first, to help you get up and running with eInvoicing.

2. Interrogate your current invoice processes  

Look over your current invoicing systems and assess the volume of invoices sent out each month, the number of suppliers in your system, the amount of hours currently spent on invoicing, and (if needed) who manages your invoicing process.

Once you have these answers, you’ll be equipped with a strong level of information to prepare you for the change to eInvoicing.

You’ll also quickly see the amount of time you could save yourself and your team, that could be reinvested into other activities that will help you to power your business forward.
 

3. Consider your business security

Sending invoices via email leaves businesses open to fraud, email scams and cyber-attacks, including ransomware. Ask yourself if you can afford a breach and if you want to reduce this risk for your business as you look to improve your systems.   

eInvoicing incorporates strict protocols which mean your invoices are secure when they’re sent through the network. In addition to both the details of the sender and receiver being validated, the security of the system lowers the chance of your invoices being compromised and likewise, your PDF invoices being intercepted.
 

4. Communicating change with your business connections

eInvoicing relies on both your business and your suppliers and partners being onboard, in order for the system to work effectively.

This is why it’s worth making a plan to communicate about your move to eInvoicing with your partners. To start, perhaps prioritise the businesses or suppliers you create the highest volume of invoices for each month, and work your way through your list from there, once you’re set to go.
 

5. Do your research to cover off any unknowns

To ensure you and your team feel comfortable about making a transition to eInvoicing, this means fully understanding how it works, the benefits, and what the best solution for you might be – it could already be included in your existing business management platform.

To find out more about eInvoicing and if your existing software provider is enabled and accredited, visit einvoicing.govt.nz or talk to your accountant or bookkeeper about readying your business for eInvoicing.

Darren Smith (pictured above) is MYOB’s Chief Product and Technology Officer.