iofm: transform your payables into a revenue generator
TRANSCRIPT
![Page 1: IoFM: Transform Your Payables into a Revenue Generator](https://reader033.vdocument.in/reader033/viewer/2022042821/55d520a6bb61eb9e578b476c/html5/thumbnails/1.jpg)
Transform Your Payables Process into a Revenue Generator…
Guaranteed.
Presented By:
Matt Wright, VP Client Services, Taulia
![Page 2: IoFM: Transform Your Payables into a Revenue Generator](https://reader033.vdocument.in/reader033/viewer/2022042821/55d520a6bb61eb9e578b476c/html5/thumbnails/2.jpg)
Fundamental Inefficiency in the Supply Chain
Buyers are Holding Record Amounts of Cash Generating Low Returns
Small Businesses Have Limited Liquidity and High Cost of Capital
Traditional Supply Chain Connectivity Creates Delays in Supplier Payment
![Page 3: IoFM: Transform Your Payables into a Revenue Generator](https://reader033.vdocument.in/reader033/viewer/2022042821/55d520a6bb61eb9e578b476c/html5/thumbnails/3.jpg)
Record Amount of Cash Earning Low Return
Buyers Have Excess Cash
U.S. Non-Financial Companies’ Cash & Liquid Assets
Low Return on Cash
U.S. Interest Rate – 10-Year Treasury Rate
($ in tn)
0%
2%
4%
6%
8%
10%
$0.0
$0.5
$1.0
$1.5
$2.0
![Page 4: IoFM: Transform Your Payables into a Revenue Generator](https://reader033.vdocument.in/reader033/viewer/2022042821/55d520a6bb61eb9e578b476c/html5/thumbnails/4.jpg)
Suppliers Have No Access to Financing
Suppliers Face a Financing Gap and Predatory Costs of Capital
Traditional Supplier Finance Only Serves the
Largest Suppliers
Banks Continue to Enforce Strict Lending
Requirements
“Long-tail” Suppliers Limited to Factoring, P-
cards and Other Expensive Forms of Finance
![Page 5: IoFM: Transform Your Payables into a Revenue Generator](https://reader033.vdocument.in/reader033/viewer/2022042821/55d520a6bb61eb9e578b476c/html5/thumbnails/5.jpg)
Lack of Connectivity Causes Delay in Payments
Su
pp
liers
Bu
yer
s
Inefficient Buyer-Supplier Connections Lead to No Visibility
into Invoice Process
APPROVED INVOICE
10 DAYS
Average time to approve a valid invoice
Source: Taulia Analysis Source: REL/Hackett Group
Average U.S. payment terms
55+ DAYS
![Page 6: IoFM: Transform Your Payables into a Revenue Generator](https://reader033.vdocument.in/reader033/viewer/2022042821/55d520a6bb61eb9e578b476c/html5/thumbnails/6.jpg)
Banks Benefit from This Inefficiency
SUPPLIER Invoices Customer
BUYER Approves Invoice
on Day 5
BANK
Invoice-Net 60
Buyer Earns 0.75% APR until
Due Date
Suppliers Borrow at 20+%
APR
1.
2.
3.
![Page 7: IoFM: Transform Your Payables into a Revenue Generator](https://reader033.vdocument.in/reader033/viewer/2022042821/55d520a6bb61eb9e578b476c/html5/thumbnails/7.jpg)
Common Challenges within Payables Process
No visibility into the invoice process
Unnecessary invoice
status and inquiry calls
AP Depts. drowning in paper
High cost of
manually processing
invoices
Missed early payment discount
opportunities
![Page 8: IoFM: Transform Your Payables into a Revenue Generator](https://reader033.vdocument.in/reader033/viewer/2022042821/55d520a6bb61eb9e578b476c/html5/thumbnails/8.jpg)
Buyer / Supplier Pain Points
Why do supplier inquiry calls take up most of my time?
Am I missing out on supplier discount opportunities?
Is there a better way to optimize working capital?
Buyer Pain Points
Did you receive my invoice?
When will I get paid?
Can I get paid earlier?
Supplier Pain Points
![Page 9: IoFM: Transform Your Payables into a Revenue Generator](https://reader033.vdocument.in/reader033/viewer/2022042821/55d520a6bb61eb9e578b476c/html5/thumbnails/9.jpg)
Solving The “What If” Game
What if…
You can address your suppliers’ needs for early payment?
What if…
You keep all the returns that would have normally gone to the bank?
What if…Suppliers could check the status of their invoices online 24/7?
Suppliers could incentivize early payments?
What if…
What if…There is a way for you to pay your suppliers less and have them thank you?
![Page 10: IoFM: Transform Your Payables into a Revenue Generator](https://reader033.vdocument.in/reader033/viewer/2022042821/55d520a6bb61eb9e578b476c/html5/thumbnails/10.jpg)
This Can Be Achieved with Dynamic Discounting
3.0%
2.5%
2.0%
1.5%
1.0%
0.5%
0%0 10 Days 20 Days 30 Days
$
2% 10 Net 30
“Hit-or-Miss Discount”3.0%
2.5%
2.0%
1.5%
1.0%
0.5%
0%0 10 Days 20 Days 30 Days
$
$
Sliding Scale Discount
Antiquated Discounting Dynamic Discounting
![Page 11: IoFM: Transform Your Payables into a Revenue Generator](https://reader033.vdocument.in/reader033/viewer/2022042821/55d520a6bb61eb9e578b476c/html5/thumbnails/11.jpg)
An Emerging Trend
Introduction Growth Maturity Decline
Innovators Early Adopters Majority LaggardsSource: PAYSTREAM ADVISORS
Dynamic Discounting
IDC/OCR
Paper CheckP-Cards
Outsourcing
Front-end Imaging & WorkflowE-Procurement
Electronic Invoicing
B2B E-Payments
![Page 12: IoFM: Transform Your Payables into a Revenue Generator](https://reader033.vdocument.in/reader033/viewer/2022042821/55d520a6bb61eb9e578b476c/html5/thumbnails/12.jpg)
Payables as an Opportunity for Revenue
0 DAYSinvoice
10-15 DAYSapproval
60 DAYS due date
OPPORTUNITY
AVERAGE PAYMENT TERMS (DAYS)
Anheuser-Busch
Hertz
Apple
Industry Average
120 DAYS
60 DAYS
45 DAYS
56 DAYS
![Page 13: IoFM: Transform Your Payables into a Revenue Generator](https://reader033.vdocument.in/reader033/viewer/2022042821/55d520a6bb61eb9e578b476c/html5/thumbnails/13.jpg)
The Win-Win Solution that Generates Revenue
Enables Buyers to save money and improve return on cash by paying suppliers early
Enables Suppliers to access less expensive financing alternatives by accepting time-variable Dynamic Discounts
![Page 14: IoFM: Transform Your Payables into a Revenue Generator](https://reader033.vdocument.in/reader033/viewer/2022042821/55d520a6bb61eb9e578b476c/html5/thumbnails/14.jpg)
Now With More Flexibility Than Ever Before
Buyers can now pay their suppliers early while having the flexibility to choose the funding source
3rd Party Financial Institution
Buyer-Funded
![Page 15: IoFM: Transform Your Payables into a Revenue Generator](https://reader033.vdocument.in/reader033/viewer/2022042821/55d520a6bb61eb9e578b476c/html5/thumbnails/15.jpg)
Flexible Interest Rates Set By You
• Available cash• Supplier
segmentation• Offer rates• Available payment
dates
• DPO strategy• Market interest rate• Supplier rating (Dun
& Bradstreet)• Supplier performance
(Scorecard, Preferred Supplier)
• Opt-in based on supplier need at the time of approval to the
• Offers are made to AR who are managing collections
• Result often differs from initial PO negotiation
Finance controls the offer
Rates are flexible
Supplier can opt-in
![Page 16: IoFM: Transform Your Payables into a Revenue Generator](https://reader033.vdocument.in/reader033/viewer/2022042821/55d520a6bb61eb9e578b476c/html5/thumbnails/16.jpg)
Why Suppliers Choose Early Payment Discounts
Allow them to get paid sooner
Payment dates are well under industry averages
Discount rates can be less expensive than alternative forms of financing
More convenient than funding alternatives
Better balance sheet Helps to meet quarterly targets
![Page 17: IoFM: Transform Your Payables into a Revenue Generator](https://reader033.vdocument.in/reader033/viewer/2022042821/55d520a6bb61eb9e578b476c/html5/thumbnails/17.jpg)
Cost-Saving Efficiencies
Dynamic DiscountingFinancial Gains
eInvoicingEfficiency Gains
![Page 18: IoFM: Transform Your Payables into a Revenue Generator](https://reader033.vdocument.in/reader033/viewer/2022042821/55d520a6bb61eb9e578b476c/html5/thumbnails/18.jpg)
Unparalleled Visibility, Control & Compliance
The Many Cost-Saving Benefits of eInvoicing
Reduced Processing Costs
Increased Invoice Approval Cycle Times
Improved Cash Management
Increased Visibility into Invoices and Payments
Greater Accuracy and Efficiency
![Page 19: IoFM: Transform Your Payables into a Revenue Generator](https://reader033.vdocument.in/reader033/viewer/2022042821/55d520a6bb61eb9e578b476c/html5/thumbnails/19.jpg)
Key Buyer Benefits of an Automated P2P Platform
01Eliminate paper and data entry from the invoicing process to increase AP efficiency
INCREASE eINVOICING
02Give suppliers 24/7 access to the status of their invoices and payments
ELIMINATE INQUIRIES
03PO distribution, delivery, confirmation and ASN. PO flip into invoices
CONTROL ASN & PO
04Interact and communicate with suppliers more efficiently. Control mass communication
COLLABORATE
05Allow suppliers to update banking and address; request documents electronically
VENDOR MAINTENANCE
06Add benchmarks, measure performance metrics and make actionable decisions
ANALYTICS
![Page 20: IoFM: Transform Your Payables into a Revenue Generator](https://reader033.vdocument.in/reader033/viewer/2022042821/55d520a6bb61eb9e578b476c/html5/thumbnails/20.jpg)
Key Supplier Benefits of an Automated P2P Platform
02Suppliers have 24/7 access to the status of their invoices and payments
TRANSPARENCY
06Suppliers can easily update banking and contact information – reducing error and speeding payments
SELF SERVICESEARLY PAYMENT DISCOUNTS
05Suppliers can opt-in for early payment discount as an inexpensive, fast and easy way to obtain financing
04Suppliers can easily forecast financials and plan ahead for future needs
IMPROVED FORECASTING
IMPROVED PAYMENT TIMING
01Suppliers can easily manage their cash flow with payment certainty 03Billing and remittance
information is available 24/7
LOWER AR COSTS
![Page 21: IoFM: Transform Your Payables into a Revenue Generator](https://reader033.vdocument.in/reader033/viewer/2022042821/55d520a6bb61eb9e578b476c/html5/thumbnails/21.jpg)
Turning Payables into a Revenue Generator
Reduced Costs
Financial Operational CostsHard Savings Through Discount ProgramReduce Supplier Inquiries / Redirect Resources
Eliminate Paper within AP
Organically Grow eInvoicingReduce Invoice Approval Cycle TimeReducing Manual Entry Errors
Improved Supplier Services
Do Something FOR your Suppliers Instead of TO your SuppliersSelf-Services Allow Less Administrative ResourcesImproved Controls and Supplier Satisfaction
![Page 22: IoFM: Transform Your Payables into a Revenue Generator](https://reader033.vdocument.in/reader033/viewer/2022042821/55d520a6bb61eb9e578b476c/html5/thumbnails/22.jpg)
Transforming Your AP Department
Imagine a world where…
Supplier inquiry calls become a thing of the past
Automating and maximizing supplier discounts is finally achievable
Buyers have a lean invoicing, payables & discounting process trimming millions off the bottom line
![Page 23: IoFM: Transform Your Payables into a Revenue Generator](https://reader033.vdocument.in/reader033/viewer/2022042821/55d520a6bb61eb9e578b476c/html5/thumbnails/23.jpg)
Questions?