As technology advances and digitally savvy customers are able to access information at any day or time on any device from anywhere in the world, their demands will fundamentally evolve. Whether it’s demanding customised information through their preferred device and channel or the timing of their communication, it is important for companies delivering business documents, such as invoices, to proactively think about how to meet such expectations and provide the best customer experience. As a result, more and more companies are choosing to go digital, making document retrieval and management simple, easy and accessible at any time. Going digital provides flexibility and simplicity for your customers and will become a key competitive advantage for your business.
According to global industry leader, Billentis, “In 2019, only around 55 billion invoices are exchanged on a paperless basis, which represents only 10% of the overall volume of invoices released. As a business, there are a number of major drivers for e-invoicing. EY’s 2018 Worldwide Electronic Survey states, “Adopting an electronic invoicing solution allows you to realise cost reductions, economies of scale, efficiencies and improved accuracy. In choosing the most effective e-invoicing solution, several factors come into play. The factors can include how technical options offered by different software suppliers fit your company’s existing IT profile, your company’s activities, the number of invoices you issue, format requests and the needs of third parties (such as suppliers and customers.)”
Within the Zion Market Research Report, the global e-invoicing market was valued at approximately USD 4,649 million in 2018 and is expected to generate around USD 20,529 million by 2026, at a CAGR of around 20.4% between 2019 and 2026. It was also determined that:
“The rising adoption of cloud-based services is the major factor driving the growth of the global e-invoicing market. Cloud computing plays a major role in solving inefficiency issues in organisations and boosting sustainable business growth. Moreover, redundant procedural, administrative, software, and hardware costs of organisations are also avoided by using cloud computing. The Internet has permitted the formation of web forms and web invoicing so that the electronic invoice data can be entered online. This has led to the wider adoption of e-invoicing. Furthermore, increasing government initiatives for e-invoicing is further anticipated to strengthen the global e-invoicing market growth over the forecast time period.”
Companies need to embrace digital transformation and process automation as the new standard and figure out the best blueprint for their business. As businesses begin to adopt e-invoicing and require that their suppliers send invoices electronically, it will create a network effect with both buyers and suppliers realising the benefits of e-invoicing. These benefits include reduced costs and errors, faster payments and streamlined processes. In the end, e-invoicing is nearly identical to traditional paper invoicing as it contains key information such as customer invoice number, shipping or service address, goods sold or service rendered, price, quantity, PO details, payment information, dates of the transaction and supplier information.
The other drivers for e-invoicing are global regulations and value-added tax (VAT) obligations. European markets have been actively preparing for the digital transformation of business-to-government (B2G) and business-to-business (B2B) invoicing. E-invoices will be mandatory not only for B2G but also for B2B transactions. In 2019, Italy introduced the so-called clearance model, which is already dominant for instance in Latin America. All invoices will be reported and validated by the tax authorities before or during the exchange process in an effort to stop the VAT leakage. Currently, Spain, Germany, Greece, Portugal, and France are considering similar solutions. The US market has also taken notice. The Business Payment Coalition in the Federal Reserve Bank has actively moved forward with an effort to create a national e-invoicing standard for the United States.
Geographically speaking, within the Zion Market Research Report, we’ve seen that, by region, Asia Pacific is predicted to be one of the fastest-growing markets of e-invoicing within the forecast period, owing to the growing penetration of advancing technology support and rising automation trends, especially in emerging countries like China and India. Europe was the second-largest e-invoicing market in 2018 globally. This can be due to huge technology support by the government and growing automation trends. North America held a sustainable market share of the global e-invoicing market in 2018. The U.S. was the largest contributor to the North American e-invoicing market in 2018, due to the early adoption of new and emerging technologies, growing investments made for cloud-based solutions by top organisations, and the presence of a large number of market players in this region.
Business leaders and CEOs agree that customer experience is vital to growing their business. Unfortunately, they often overlook the importance of customer communications in the overall customer experience. Offering multi-channel delivery with secure, timely and on-brand communications is essential to providing the best experience for customers while improving the operational costs and efficiency of organisations. As the pressure increases for the need to offer communication preferences for your customers, and adhere to global regulations around e-invoicing, Quadient’s Output Management Software helps organisations automate, secure and centralise their document creation and delivery process so they can evolve and scale their business. To learn more, check out our video below