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5 Ways Poor Invoice Management Will Hurt Your Business

Businesses, irrespective of their size, frequently deal with invoices.  These invoices can be inward, outward, or both ways in most cases. No business is an exception to that. Even the businesses of the most basic nature that produce things on their own like agriculture and manufacturing, also have to buy and sell goods and/or services. Purchases of agricultural supplies, raw material, everything comes with an invoice. Invoicing could have been simpler if there were instant payments only. Sadly that’s not the case. The business world revolves around credit. That means deferred receipts and payments and a lot of record-keeping. In the case of invoices, the practice is known as invoice management. The term invoice management is often confused with invoice processing but that’s not correct. Invoice management is a much broader term than invoice processing.  Invoice processing can be considered a component of invoice management. Before discussing a poor invoice management system, Let’s take a look at the basics.

Invoice Processing

Invoice processing is about the invoice journey from procuring to payment of an invoice within an organization. Usually, most of the invoice processing is required at the buyer/receiver’s end. In the case of the buyer, it is dealt with as accounts payable. Core functions of a most common invoice processing model can be;

·         Invoice Submission

·         Invoice Verification 

·         Invoice Approval

·         Invoice Payment

Organizations can have different workflows for invoice processing depending upon their specific requirements. In smaller setups, an individual may be performing all these functions and there can be separate persons or even separate departments performing these functions in bigger organizations.

Invoice Management

Invoice Management is a broader term that may include;

·         Invoice processing, Cash flow management

·         financial management

·         supplier management

·         invoice financing/factoring

Invoice management is a comparatively modern approach that deals with invoicing beyond processing.

Nowadays, it is almost necessary for a business to have some invoice automation solution in place. For businesses with bigger volumes, it becomes even more essential. 

Cons of Poor Invoice Management

Invoice Management if not done properly, can make a business suffer in many ways. Let’s take a look at some major issues a business may face in the absence of a proper invoice management system.

·         Poor Cash Flow Management

·         Poor Financial Analysis

·         Extra Workload

·         Waste of Resources

·         Poor Business Relationship

Poor Cash Flow Management

When you don’t have an efficient invoice management system in place, you won’t be able to manage the proper record of invoices. Without a proper record, you won’t be able to pay/get paid for your invoices in time. In a business with significant commercial activity, the accounts payable and receivable significantly contribute to the cash flow of the business. Poor cash flow management is a major factor that hurts a business.

Poor Financial Analysis

Either you have to pay an invoice or you have some invoice to be paid to your business, it is necessary to have the proper knowledge about that. A transparent picture of receivable and payable is always necessary to make informed decisions and forecasts. Lack of a proper invoice management system will keep you blind from many things resulting in bad decisions and subsequent financial losses.

Extra Workload

A poor invoice management systems mean more workload on your employees. They have to give more time to issues like revision, alteration, reconciliation both within the organization and with suppliers/customers. An inefficient invoice management system means more workload and less productivity which is damaging for business in the long run.

Waste of Resources

As discussed in the previous heading, a poor invoice management system will put more workload on the existing resources. It will also result in the loss of precious time and monetary resources. You need to put more resources in unnecessary jobs which can be avoided with a proper invoice management system. An efficient invoice management system will eliminate such unproductive exercises in the first place.

Poor Business Relationship

In the absence of a proper invoice management system, it is quite normal to have discrepancies with your supplier/customer over reconciliation and late payment scenarios. Poor record keeping will not only affect your business relationship but also the productivity and profitability of the business. You have to have a lot of unnecessary futile business exercises that can be avoided otherwise.

By now we’ve accessed that a poor invoice management system will not only hurt your peace of mind and productivity but can also give you huge financial and reputation costs. Having a proper invoice management system is very critical for the progress of an organization.

InvoiceMate is a comprehensive invoice management solution by MateSol that effectively addresses the above problems. InvoiceMate is the first blockchain-based invoice management system that brings with it unmatched efficiency and transparency at every level of invoice processing. Powered by AI and blockchain, InvoiceMate not only eliminates the challenges of manual invoice processing but also fills the gaps left by conventional invoice automation systems.

To learn more or to get a demo arranged, please feel free to write us at:

mate@invoicemate.net