Electronic invoicing is gaining significant traction among high volume shippers and freight forwarders, according to a study conducted by the portal-based ocean shipping network INTTRA.
The study, conducted in 2012 and released Wednesday, includes feedback from four of the top five global logistics providers. INTTRA has also released a set of white papers
on the subject.
“Four years of economic volatility have intensified pressure on carriers and shippers to seek new ways to reduce costs and have seen no relief on pressure to increase service levels,” INTTRA said. “One cost reduction method that has demonstrated results across government and commercial sectors is electronic invoicing (e-invoicing). Once referred to simply as a ‘best practice,’ e-invoicing is emerging as a critical cost reduction tool for companies in or those impacted by the struggling ocean shipping industry.”
The study found that:
- 81 percent of respondents want to receive invoices electronically in 2013.
- 77 percent rate “managing disputes” as their greatest invoicing challenge, with reducing the “time and cost to process invoices” as a close second at 68 percent.
- The top 10 countries expressing demand for e-invoicing include the United Kingdom, China, the Netherlands, United States, Germany, Singapore, Australia, France, Hong Kong and Italy.
"Invoicing, dispute resolution and payment processes are highly fragmented across the industry and represent a significant area of cost and inefficiency,” said Otto Schacht, executive vice president of sea logistics at Kuehne + Nagel. “Logistics providers and their ocean carriers can benefit from standardizing the process, improving visibility to their cash liabilities and providing a more transparent invoicing process, all of which save time and resources."
Manual payment processing results in excess costs for carriers and shippers on a daily basis, which adds up to millions of dollars annually. The European Commission Informal Task Force on e-Invoicing found that the average cost of processing a paper invoice in Europe was approximately $48. Other reports suggest e-invoicing can yield savings of as much as $55 to $88 per bill of lading.
INTTRA said reduction of errors and disputes is the top driver of increased demand for e-invoicing in 2013. Survey responders estimated today’s invoice error rates are between 20 and 25 percent.
“We are seeing a rapidly growing adoption and need for e-invoicing in the ocean shipping industry,” said Rod Agona, director of professional services at INTTRA. “It’s no secret that this sector is dealing with a tough economy – one that has likely forever changed. It has both carriers and shippers looking for ways to be more efficient and profitable, and e-invoicing is a proven method to achieve those goals.” - Eric Johnson