Better data than confidence in bill payments

0

As much as the pandemic has changed the way we do business, she also underscored how vital it is to have a strong working relationship to ensure that B2B shipments, processes and payments keep flowing, especially when the going gets tough. conditions are not optimal.

While mutual trust is still at the heart of most merchant-supplier relationships, Michael rabinowitz, CEO of a supply chain and business analytics firm Joint venture, told PYMNTS that many of the late fees and chargebacks that come with these complex and costly relationships are often unnecessary.

“What’s a challenge in the industry is that a lot of times manufacturers don’t know if retailers have actually received an invoice,” Rabinowitz said, and that’s important “because the net terms don’t actually start. only when the retailer physically receives the invoice. “

For example, he said, imagine you were a furniture maker who delivered a load of chairs to a retailer, on time and as requested. You know the retailer received the chairs, stored them, and started selling them, so you send them an invoice so you can get paid.

The problem, Rabinowitz explained, is that “I might not know if this invoice was received by the retailer – and it happens a lot – because until I’m supposed to get paid or realize that I haven’t been paid ”, there is often no way of knowing that this critical step in the B2B payment process has been checked.

“And then my AR [accounts receivable] The team calls the retailer and says, “You’re overdue,” then they say, “Well, we haven’t received an invoice yet. “

It is not so much a breach of trust between two business partners as a breakdown in communication that can easily be resolved in a preventive manner for the benefit of all parties involved.

Data patch

Unsurprisingly, CoEnterprise’s latest software platform solves this exact problem, and several others, by enabling a real-time, multi-faceted data interface that allows all participants in the supply chain process to see this. which is in transit, delivered, invoiced and due. .

“So there is a lot of trust, but there is also a lot of overhead in running the process,” Rabinowitz said of the old but still common paper bill, check and phone call method. used in many B2B relationships.

While some large retailers have web portals that allow suppliers and sellers to check and see what supply chain documents have been received, including invoices, Rabinowitz said it was always about an “incredibly manual process”.

That is to say, compared to the digitization of the company Synchronize a system that he says “sends signals from both sides of the relationship – when things are sent and received and when things haven’t been received within the agreed time frame.” [terms] of the two organizations.

For example, he said, CoEnterprise knows when an invoice is sent from the manufacturer to the retailer, and if that retailer doesn’t recognize it or pick it up, then the company sends a signal notification via email or in application to the manufacturer. to let them know right away that it was not received so they can follow up.

He said that promoting transparency and visibility in this way actually improves the buyer-seller relationship.

“Absolutely, information is power, and we look at every data point along the supply chain process that can help the relationship be more efficient and mutually beneficial,” he said. declared.

Given the unprecedented focus on supply chain logistics today and the need to streamline processes and develop transparent contingencies before problems arise, Rabinowitz said this facet of the B2B functionality could not be overlooked.

“It is essential,” he said. “We work in the pharmaceutical, retail, manufacturing distribution sectors and now more than ever these relationships [have become] more important, and trust between partners is more important.

——————————

NEW PYMNTS DATA: STUDY PUTTING LOYALTY AT THE SERVICE OF SMALL BUSINESSES – UNITED KINGDOM EDITION

About the study: UK consumers see local purchases as essential for both supporting the economy and preserving the environment, but many local High Street businesses are struggling to get them in. In the new Making Loyalty Work For Small Businesses study, PYMNTS surveys 1,115 UK consumers to find out how offering personalized loyalty programs can help engage new High Street shoppers.

Share.

Comments are closed.