We’re crazy about efficiency and productivity hacks around here.
So when we heard IOFM and the Financial Operations Network were presenting, Learn How to Slash the Amount of Time Your AP Staff Spends on Vendor Inquiries, we couldn’t resist attending.
We’ve always known there’s a great efficiency advantage to implementing a supplier portal so we decided to join and discuss with our peers. What’s particularly fascinating is one of the top complaints among suppliers involves the lack of visibility into the status of invoices and payments. Simply providing this visibility to your suppliers, in the form of a self-service portal, eases their top pain point and instantly strengthens your relationships with them.
If you didn’t catch the webinar, here’s a snapshot of the key takeaways:
1. A typical AP department can expect inquiries from 3-15% of their invoices volume, and 60% of these inquiries are in regards to invoices that are already paid.
It’s no wonder suppliers want full invoice and payment visibility--they’re spending time calling buyers about invoice receipt and payment status! If you’re processing 100,000 invoices annually, you can expect anywhere between 3,000-15,000 inquiries/year, and 11-55 inquiries a day. That’s a lot of phone calls to answer and emails to respond to on a regular basis! What if your suppliers automatically received a notification when invoice is approved? Or payment is processed? Your suppliers would have peace of mind knowing payment is on its way, and you’d also save them time from having to call about the status.
2. Internal customers (buyers/requisitioners) represent 40%-60% of all inquiries that AP Departments receive.
If you’re receiving roughly 10 inquiries a day, 4-6 of those inquiries might be in person, which may cause frequent interruptions throughout your day. Giving your suppliers and internal customers full visibility empowers them to answer their own questions, leaving you more time in your day to focus on strategic AP initiatives.
3. Supplier portals can eliminate up to 80% of inbound inquiries.
If your AP department spends 3 hours/day answering inquiries, that’s 15 hours/week total spent on communicating with suppliers. Implementing a supplier self-services portal would free up 12 hours/week, or 648 hours/year. What could your company do with an extra 12 hours/week?
Clearly, a self-service portal will give your AP department and your suppliers ultimate efficiency by eliminating up to 80% of invoice and payment inquiries. To calculate the value of a supplier portal:
(Time Spent per query * Cost/Hour * Number of queries per day * 250) = Annual Cost of Queries
• Time per query (in hours)_____
• Cost per hour $____
• Number of queries per day _____
• 250 work days per year
= Annual Cost of Queries $____
Portal cost $____
What impact has a supplier portal made on your organization? What surprised or impressed you most about the webinar?
About the AuthorMore Content by Branden Lewis