how much money do you lose every year through manual order processing?

How Much Money Do You Lose Every YearThrough Manual Order Processing?

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2| OmPrompt - How Much Money Do You Lose Every Year Through Manual Order Processing?

Most companies think that their customer supply chain and logistics teams’ time is spent on developing

customer relationships (41%), profiling and upselling (28%) and promotional

activities (19%).

In reality, this time is spent on: processing customer orders (31.2%) and resolving order errors (12.8%) or

delivery discrepancies (9.4%).

OmPrompt research


How Much Are You Losing Each Year? £50,000? £100,000? £1m? The fact is you probably don’t even know – and you’re not alone, because estimating how much money is lost across your O2C supply chain – even if it’s really efficient - is not easy.

1 We’ve worked this average out, based on a cross-section of our experience with our own clients.

Mistakes are common with manual/paper ordering processing – and a huge drain: causing write-off costs

and wasting manpower.”“Here are some examples of how much money is really lost…• Many companies admit they don’t know

the cost of handling order paperwork. Yet for some global suppliers, the cost of manual order processing effort could be as much as £720k annually.

• For a company turning over around £2 billion per annum, the costs of written-off orders due to human error as a result of manual order processing can be as much as £18 million per annum (much higher than it need be) and of that, we’ve helped them save £5.4 million per annum.

But here’s how much money can be saved with automation…• Eliminating manual re-keying leads to an

average 48% reduction in manpower. That nearly halves your salary costs, or lets you redeploy people to add value elsewhere.

• Costs per order are likely to be 64% higher than they need be1. For example, with automation the cost per order could be reduced from, say, £2 to 71p.

• A fact also acknowledged by many suppliers in our experience is that time spent handling order paperwork distracts them from more strategic or value-added tasks such as proactive customer service, cross-selling and upselling.


Small Inefficiencies, Big Losses How much are those ‘inevitable’ order processing mistakes really costing you?

One of our customers, an international alcoholic beverage company, felt they had a pretty efficient order process – a 0.6% error rate. They were able to reduce it to 0.2%. That doesn’t seem hugely significant until you realise that it’s one third of the number of errors!

Another customer of ours, a multinational healthcare supplier, switched from manual order processing and reduced cost-per-order by 66% - estimated to amount to at least £500k over three years.

The devastating fact is that order processing inaccuracies don’t just result in one-off losses; they generate incremental losses that rise and rise throughout your system, such as, customer relationship costs and also KPI costs.

No mistake in the supply chain is ever an isolated event: it can turn from a small ripple into a tsunami of negative, knock-on consequences.


The Mistake MultiplierLots of departments, skill-sets and people are involved in the supply chain: accounts payable and accounts receivable, IT, warehouse staff, drivers, buyers, stock control, customer service representatives and customer supply chain and logistics teams.

Oh yes, and we haven’t included the negative costs to cashflow of not having your invoice paid swiftly and the penalty costs for late delivery – not to mention the cost of customer satisfaction

For straightforward, routine orders the way costs rise when they turn bad, goes something like this:

3

1

4

2

5

At the front end an order is incorrectly understood and erroneously keyed

in, resulting in the wrong order being dispatched to

the client.

Some, or all, of the delivery is refused and

returned and part or all of the invoice is paid.

Admin time is taken up investigating the order inaccuracy to find out where the error lay.

The order has to be found and reprocessed, correctly

this time.

Resources are needed for picking, packing, and checking the new order

(assuming the goods are in stock)!

Stock needs to be updated and amended accordingly.

6 7 8

Fines and penalties may apply to the original

delivery.

The new order is scheduled for delivery: leading to more time

and cost.

Driver time and added fuel costs need to be

factored because of added unplanned journeys.

The time and costs begin to compound on one another, disrupting backwards and forwards, into your supply chain often in very complex ways.

The manpower might involve between 5 and 15 people in administration, logistics and stocking, all having to add hours to their workload, causing bottlenecks and delays further down the line.


Automation is the answerManually entering orders, and chasing and tracking information, is a hands-on affair and inherently inaccurate.

Most companies are aware of the challenges of order processing, from the lack of control to the cost impact on their business, but it seems they’re often either too busy to look at rectifying the situation or, they don’t know how to make a positive change through automation.

By using OmPrompt’s Customer Automation Management service, however, the moment a transaction makes its way onto your radar, the potential for error is eliminated; leaving your company free to improve customer satisfaction, rather than firefighting issues.

Guaranteed transactional excellence, gives you the time and understanding to look at areas of the supply chain where improvements can be made. In other words, knowing that your initial incoming order processing is spot on, means that you might be able to look at other processes down the line, such as claims or transportation, which could be causing problems and which have remained obscured.

Oh, and by the way, we can help with those too.

So, how much money DO you lose every year through manual order processing? We can help you answer this

question and resolve it.

Call us on: +44 (0)1235 436 000


If you’re ready to embrace automation...Get in touch now: +44 (0)1235 436000 or [email protected]

The OmPrompt Solution:1. Allows you to see results quickly, and add

customers and advanced component solutions as and when required;

2. Is security accredited, available 24/7 and highly scalable;

3. Uses award-winning industry-leading technology to automate your O2C process;

4. Can be implemented within days or weeks – with minimal IT investment; and there’s no hardware or software to install;

5. Integrates with your existing infrastructure;

6. Is a managed service solution based in the cloud so every relevant person in your organisation has appropriate visibility with orders, shipments, inventory, invoices, and payments;

7. Supports all EDI formats (such as EDIFACT, TRADACOMS, ANSI etc.), email, PDF, fax, etc. It also supports all the main ERP, CRM, transport management/planning and warehouse management systems.

OmPrompt allows organisations to:1. Manage risks more

effectively;

2. Improve service;

3. Spend more time adding value and pursuing new customers;

4. Have greater visibility into the fulfillment process;

5. Have a more accurate picture of compliance;

6. Speed up the O2C process and get paid faster;

7. Reduces your cost to serve;

8. Improve fulfillment performance;

9. Get your people back to serving your customers!

16 Facts You Need to Know About OmPrompt

OmPrompt allows you to concentrate on your core business by freeing up the time your staff spends

on processing customer transactions. How? We focus on what we do best: processing your business-critical messages; so you can do more of what you do best!


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OmPrompt Ltd67 Innovation DriveMilton Park, AbingdonOxfordshire, OX14 4RQUnited Kingdom

+44 (0)1235 [email protected]

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As the pioneer of customer automation management, OmPrompt helps a growing number of the world’s leading brands eliminate gaps in the order-to-cash process that have tradition ally required manual workarounds.

OmPrompt has innovative ways of automating repeti tive manual work in the customer management cycle, enabling clients to free up resources, manage by exception, remove restric tions, and eliminate risks to their businesses.

Our intelligent, cloud-based solutions are delivered as a service, co-exist with EDI-based solutions, are quick to deploy, easy to extend, and offer an exceptionally fast ROI.

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how much money do you lose every year through manual order processing?

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