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Automated Invoice Processing

By 5 June 2023April 15th, 2024No Comments
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How Automated Invoice Processing Can Save You Time and Money?

Imagine a scenario where you are running a small or medium-sized business. Invoicing will be a necessary task to maintain financial records and adhere to compliance.

You can use spreadsheets or other manual methods to record each invoice. 

Sounds simple, right? 

But can you manage hundreds or thousands of invoices with primitive manual measures? You will only create unnecessary long queues, delays, and chaos at your business.

overdue invoice letter writing tips

Are you also tired of the time-consuming and error-prone tasks of manual invoice processing? If yes, then you are not alone. Many businesses need help managing their invoice process with a certain level of accuracy and efficiency. They want to avoid delays, errors, and financial losses.

Manual processes are notorious for creating issues like missing invoices, fraud, and delayed payments. All these troubles can hurt your business and damage your customer relationships.

Automatic invoice processing can help you manage your invoices and avoid costly errors.

Businesses automate invoice processing to save time and money while reducing the risk of errors. This blog will enlighten you on everything about automated invoice processing. As direct mail experts, we will also discuss how you can automate invoice processing with our direct mail platform.

So where exactly the problem begins with manual invoice processing? And why should we automate invoice processing?

Challenges with Manual Invoice Processing

You don't want to waste time and have an error-prone process, right? It is often time-consuming, tedious, and prone to errors with a manual system. You can lose your invoices or slow down with an administrative bottleneck.

Manual invoice processing can lead to the following challenges for businesses;

Data Entry Errors 

Individuals have to enter data manually for manual invoice processing. It can lead to critical errors such as typos, incorrect numbers, or missing information. You may land into delays, disputes, and even financial losses. Coupa says over 51% of people accept manual data entry as inefficient and time-consuming.

A single mistake can cost you hundreds or thousands of dollars. Automatic invoice processing becomes necessary to avoid such errors.

Time-Consuming Process

Managing a fistful of customers is a bit easy. Yet, things can be very time-consuming when handling so many customers simultaneously, especially if you are receiving a large volume of invoices. You have to drain your time, which would limit your efficiency.

Lack of Visibility

Manual invoice processing makes it very hard to track the status of invoices. You won't be efficient enough to understand the bottlenecks in the workflow. It will only create hindrances and make it harder to manage cash flow efficiently. Having automated invoice processing software will help you to avoid such problems.

Compliance Problems 

As a business, you have to comply with regulatory requirements. Manual invoice processing can lead to vast compliance problems for your business. There are huge risks of errors or discrepancies if you don't use automatic invoice processing.

Inefficient Communication 

Manual and primitive methods lead to inefficiencies in communication and collaboration. The invoice process often requires the intervention of multiple people and departments within an organization. Thus, you can prefer automatic invoice processing to avoid delays, disputes, and errors.

High Risk of Fraud 

Sharing invoices via emails or legacy applications is not a good idea in the age of cybercrimes. Moreover, if you have third parties like vendors or suppliers, you must ensure a safer environment. Manual invoice processing can cause manipulation of records or identity theft. You can protect your business from fraud by using automated invoice processing software.

Issues with Monitoring and Storing 

Suppose your vendor raises a dispute and demands an invoice copy from 10 years ago. Will you be able to instantly provide the invoice copy to the vendor? We are sure you must look through office cabinets or internal computer storage.

Paper integrity may degrade over time, while data on hard drives might become a victim of corruption. Even working with emails won't suffice the demand instantly. You require invoice processing automation to monitor and store all your invoices effectively.

Delay in Payments 

Many manual invoices are a struggle in the ocean of approval processes. Multiple people have to give authorization and make continuous follow-ups. It can be time-consuming and might result in delays.

These delays can lead to missed opportunities for discounts and create the burden of fines. Automated invoice processing can speed up the payment processes. It can help companies boost their cash flows and build good customer relationships.

What is Automated Invoice Processing?

Automatic invoice processing refers to using software solutions to process invoices for accounts payable. An Enterprise Resource Planning (ERP) system is necessary to update this information. You can speed up invoice approvals, reduce processing costs, and minimize errors.

But how this automatic invoice processing works in real-time?

Using automatic invoice processing can help you address various challenges with manual invoices. When you have invoice automation, your team doesn't need to intervene at every invoicing step.

Let us explore each step of automatic invoice processing;

Step 1: Data Entry to the Software 

After an invoice, individuals must enter all necessary information into the software. It then relies on optical character recognition and machine learning algorithms to scan paper documents. Thus, you can eliminate the possibility of errors in invoice processing.

Step 2: Data Verification

The system can automatically verify purchase orders with the help of representatives. An automated invoice processing software verifies details, including supplier name, vendor code, quantity, purchase order number, and purchase amount. In the event of discrepancies, the software will trigger a notification for manual intervention.

Step 3: Invoice Approval 

Manual invoices need various members in the approval process. You require complex logic to execute smooth invoices. Automated workflows can reduce the complexity of invoice approval management. It brings more visibility and removes any chaos between the teams. You should automate invoice processing to simplify the approval process.

Step 4: Archive 

The ERP systems automatically store the invoices after you release the payments. You don't need any physical units for storing your invoices. Thus, exploring your records and locating a particular invoice takes seconds.

Modern technology is a significant contributor to invoice processing. Each technology comes with its characteristics and improves the performance of a company's invoice processing.

Popular Technologies Playing Vital Role in Automatic Invoice Processing 

Optical Character Recognition (OCR) 

This technology of automatic invoice processing helps in automatically scanning and extracting information from invoices. Businesses can avoid the necessity of manual data entry with OCR software. You can use this software to recognize and interpret characters and images. Later, it is possible to convert them into machine-readable data.

Electronic Invoice Presentment and Payment (EIPP)

These systems enable vendors to submit their invoices electronically. They can either rely on a web portal or email for uploading the invoices. EIPP can then automatically analyze and extract data from the invoice, check the details, and route the invoice for further processing.

Robotic Process Automation (RPA) 

This innovative technology allows organizations to automate repetitive manual tasks like data entry and invoice processing. This technology can mimic human actions, such as navigating through different screens or entering data. Automatic invoice processing software often uses this technology to smoothen the invoice generation.

Machine Learning 

The world is moving ahead with AI and machine learning algorithms. You must have heard about GPT, right? AI is making our lives much easier and more convenient. Businesses can use machine learning algorithms to process invoices and extract relevant information. It helps you with accurate and efficient data extraction. You can also detect fraudulent invoices with AI and ML technology.

Integration with Financial Systems 

Automatic invoice processing software allows businesses to integrate with their organization's financial systems. For example, you can combine invoicing with enterprise resource planning (ERP) or accounting software. It would help you to update your financial records automatically.

What Significant Changes Can Your Business See with Invoice Processing Automation?

There are several reasons behind innovative businesses pivoting towards automatic processing software. In the information-rich economy, you need automation these days for almost everything. Here's what you can expect with automated invoice processing software;

Improvement in Decision-Making 

Every organization generates massive volumes of data that are complex. Big data and automatic invoice processing can help you find invoice patterns and trends. It will give you critical insights to take necessary actions.

Save Your Crucial Time 

Automatic invoice processing can help your business to eliminate the need for manual data entry. You can save countless hours by avoiding a time-consuming process. An organization can then focus on higher-value tasks like data analysis and reporting.

Improvement in Invoice Visibility

Automated invoice processing can give you real-time visibility of invoices. It helps in tracking the progress of invoices and identifying bottlenecks in the workflow. With this assistance, you can improve cash flow management and make it easier to manage your accounts.

Save Tons of Money

Are you skeptical that automatic invoice processing will cost a lot? Yet, in reality, your business can save money by reducing the necessity of manual data entry. Furthermore, you can avoid the risk of errors, disputes, and penalties with accurate invoicing.

Better Compliance with Law and Regulations

You can comply with regulatory requirements and guidelines when you automate invoice processing. The invoicing and financial reporting are more accurate to avoid penalties for non-compliance. Businesses from every industry should focus on complying with these guidelines. The US federal authorities often penalize or impose sanctions on companies for non-compliance.

Improvement in Vendor Relationships 

A healthy relationship with vendors and suppliers can help ensure high-quality products or services. Automatic invoice processing can make your invoices faster and more accurate. With this accuracy, you can improve your vendor relationships. It can improve your negotiation power for future contracts. You can boost your overall vendor management with such solutions.

Full Control and Authority Over Your Invoices  

Remember, we are talking about fetching an invoice from 10 years ago. Do you think you have more control and authority over invoices with primitive invoicing measures? Tracking and authority are the largest advantages of invoice processing automation. It would help you track every process and control invoice management workflow.

Improvement in Team Collaboration 

Invoice management may involve multiple individuals in an organization. An automated invoice processing software auto-routes the invoice to the relevant stakeholders. Your team can free itself from repeated follow-ups and other processes.

Now comes the question, how can you automate invoice processing for your business? What qualities do you need in automatic invoice processing software?

Getting a Clear Idea About Automated Invoice Processing Solutions

So, you must know that automatic invoice processing comes with many perks. It gives you immense benefits in contrast to manual invoice processing. Yet, how to automate invoice processing.

To answer this, you have to ask yourself several questions;

  • How many invoices do you process in a month?
  • What problems do you face with your current invoice processing method?
  • Do you encounter inaccuracies in data capture?
  • Do you often face repetitive manual tasks?

You don't need automatic invoice processing if you are processing a few hundred monthly invoices. A simple in-house solution will be sufficient for your business.

But if you have to process thousands of invoices, you should use automated invoice processing software. An end-to-end solution would minimize your workload, avoid errors, and let you focus on other vital aspects of your business. Here's what you should find in your invoice automation solution;

The Ease of Use 

An automatic invoice processing software should be easy to use and navigate. It must have a user-friendly interface to reduce the need for training your staff. With this, your business will be running without problems.

Integration Capabilities  

Look for an automatic invoice processing software that can integrate well with existing account or ERP systems. The integration should be smooth and easy to improve your business efficiency. It should work with various business applications and strengthen the invoicing process.

Customization Options 

A tool without customization won't help your business to scale and personalize. The automatic invoice processing software should provide customization options to tailor the experience to specific needs.

Packed With Security Features 

When managing financial data, ensuring security at any cost is vital. Ensure your automated invoicing processing solution has encryption, secure storage, and authentication and follows necessary compliance. In this way, you can protect sensitive financial information from unauthorized access.

Scalability

Your invoicing process will have different demands at different times. Your automatic invoice processing software should be able to handle the growing volume of invoices. It must help you in adapting to different business needs. You can prevent the necessity for frequent software upgrades or alterations.

Customer Support Availability 

Do you want to get stuck with technical issues or doubts? Then find a software provider that provides comprehensive customer support with training resources. You should get online documentation, tutorials, and chat support with automatic invoice processing software.

Consider the Pricing  

Don't burn your money; look for flexible pricing plans. The automatic invoice processing software should give you flexible plans and a good return on investment. Consider the upfront costs, maintenance, and support fees before investing in a solution.

Check for Reviews & Reputation 

Before investing in automatic invoice processing software, it is vital to check its reviews and reputation in the market. By learning from authentic reviews, you will get a fair idea about the software in the real world. Try looking for reviews from B2B platforms like G2 and Capterra.

So what do you need with automated invoice processing software?

  • A highly scalable system that can adapt to any template, layout, format, or style of the invoices.
  • A solution that lets your accounts team focus on much more vital tasks than repetitive tasks.
  • Software that provides 100% data extraction accuracy for effective invoice management.
  • A solution that you can easily integrate into your systems.

What Type of Integrations Can You Expect with Automatic Invoice Processing Software? 

If you want to improve the efficiency and accuracy of invoice processing workflows, your solution should be integrable with the following systems;

Accounting Software: Such a solution would help you record accurate general ledger and accounts payable data.

Procurement Software: This solution can help you match purchase orders generated in software.

ERP: It is ideal for automating purchase invoice validation with goods or service delivery receipts.

Vendor Portal: This solution helps quickly process vendor/supplier invoices from a vendor portal.

Cash Management System: These solutions are automated payment of invoices.

BI Solutions: You can get comprehensive invoice data and processing analysis and reporting.

Automation is necessary for businesses to save time, avoid errors, and achieve innovation. You can automate various tasks with the help of automated invoice processing software;

Data Entry Needs 

Businesses have to spend a considerable amount of time on data entry. By using automatic invoice processing, you can quickly capture details from invoices. The automation cuts down the amount of manual data entry tasks. Your team can dedicate itself to doing more important tasks within their roles.

Coding Requirements 

Some invoice management software will need you to code specific items into the design and layout of invoices. Automatic invoice processing automatically codes the invoices according to your business requirements.

You can easily reference and analyze your expenses with these solutions. It simplifies the reporting of expenditures to the stakeholders and tax authorities. Automation empowers businesses to track their expenses to the last item possible.

Matching

An automated invoice processing software will help you to detect duplicate payments or bills for each purchase. Businesses can prevent double disbursements and save capital for small and large-volume transactions.

This software often uses intelligent algorithms to identify when two invoices match because of their similar vendor information or description of goods. Thus, you can easily avoid duplicity and disputes.

Approval Process 

Reviewing each invoice before approving payment takes a lot of time and headaches. Automated invoice processing makes it possible to implement predefined rules that send invoices directly into the correct workflow. You can automate the approval process without your team waiting hours for approvals.

Tracking & Reporting 

Automatic invoice processing helps you to track payments and generate reports on expenditures and other financial trends. Automation of invoices will give you better visibility into finances so that you can make vital decisions with more confidence and authority.

What Will be The Future of Invoice Processing?

Automatic invoice processing is becoming popular among businesses of all sizes. Business owners, administrators, and professionals can increase efficiency and reduce costs.

By investing in the right platform, companies can improve accuracy, speed, and data management. The future of invoicing comprises innovative technologies that will save time, reduce errors, and improve customer satisfaction.

Businesses will use digital solutions such as cloud-based software, online accounting tools, and automated payment. These solutions will fulfill their need to process a high volume of invoices quickly and accurately.

What about future trends? How should you prepare yourself?

Collaborative Workflows are Already a Thing of the Present 

You must know that collaborative invoice processing workflows already enable teams to work together more effectively. It can help reduce the risk of errors and improve your overall efficiency. Automatic invoice processing with collaborative workflows will shape the future of invoice management.

Mobile Access is All About Mobility and Convenience 

The device inside your pocket is like a Swiss Army knife. It can access all kinds of data and let you tweak various operations. Mobile access to invoices can help you work remotely or on the go. Your business can improve efficiency and fasten the workflow with automatic invoice processing.

Cloud-Based Solutions 

Many businesses are shifting towards cloud-based invoice processing solutions. You can enjoy several benefits, like lower upfront costs, easier integrations, and better scalability. It enables your business to become more adaptable and flexible with the evolving marketplace.

Blockchain Technology 

This innovative technology provides a transparent and secure ledger for invoice processing. You can enjoy much faster and more secure payments. It can reduce the risk of fraud and mismanagement.

Best Practices While Implementing Automatic Invoice Processing 

Implementing an automated invoice processing system helps businesses to save time, reduce costs, and enhance accuracy. Yet, to get these benefits, you must know about the best practices.

These are some best practices that you must follow;

Evaluate Your Current Invoicing Process 

Before investing in an automatic invoice processing system, evaluating your current process is vital. Check all the pain points and bottlenecks to identify the areas where you need automation.

Check Your Requirements 

After evaluating your current processing, you can identify requirements for automatic invoice processing. Consider factors such as invoice volume, types of invoices, and existing accounting software.

Selecting the Right Solution 

After you know about your requirements, research and compare the potential solutions. Find something that meets your business needs, provides customization, and has smooth integration capabilities.

Prepare Your Data 

Before properly implementing, you must prepare your data to digitalize invoices and clean up your data. It enables you to ensure accurate data extraction and processing.

Testing and Refinement

You can start testing the automatic invoice processing system with a small batch of invoices. It would help to refine the solution depending on any issues or errors that take place during testing. Testing can save tons of money by preventing any scope of errors.

Train Your Team 

Your team must comprehensively understand the new automatic invoice processing system. The individuals must be ready with data input, workflow management, and exception handling. Proper training ensures everyone on the team is qualified to work with the invoicing software.

Monitoring and Measuring     

You must monitor your automatic invoicing solution to ensure it meets your expectations. Try to measure the key performance indicators such as accuracy, processing time, and cost savings. It would help you to determine the impact of your invoice processing automation solution.

PostGrid Print & Mail Automatic Invoice Processing 

You must be tired of bearing huge costs to print and mail your invoices. All you need is automated invoice processing software. Your business can save tons of resources through our Print & Mail API.

What Features To Expect With Full Automation? 

Full Automation 

You can completely automate generating and sending invoices to your customers and vendors. Businesses can reduce the necessity for manual labor and cumbersome processes. Manage printing and invoices to save time and resources.

High Accuracy

Refrain from errors, including incorrect pricing, customer information, or quantities. Our Print and Mail API helps ensure your invoices are accurate and current. We help you to reduce the likelihood of errors and expenses to correct them. Get highly accurate automatic invoice processing with PostGrid.

Higher Efficiency Rates 

Our API completely streamlines the generation and mailing of invoices. You can reduce the time and cost of the invoice generation process. It can help you to avoid the likelihood of payment delays.

Additional Cost Savings 

PostGrid provides flexible pricing plans to meet the different requirements of various businesses. We provide attractive discounts on USPS shipping to help you reduce the costs of generating, printing, and sending invoices to your customers.

Highly Secure Platform

Our automatic invoice processing API prioritizes security for professionals and enterprises. We include vital features such as access control, authentication, and security to ensure data is always secure. PostGrid and all its partners are HIPAA, SOC-2, GDPR, and PIPEDA compliant. We understand the value of document integrity and complete trust.

Highly Personalizable Invoices 

We use variable data printing technology on every invoice to personalize your invoices. Our automatic invoice processing solution helps you to tailor data and design your invoices. There's no need to edit every small detail manually.

Handling International Invoices 

You can send invoices to customers and vendors outside the country of origin. Get reliable automatic invoice processing software to send invoices internationally.

By relying on our automated invoice processing solution, you can reduce costs on;

  • Energy & Utility
  • Compliance
  • Printing materials
  • Labor and workforce
  • Postage
  • Physical space
  • Software to Run Systems

Our API allows you to print and mail bulk or personalized orders on demand;

  • Ideal solution for all types of businesses and industries.
  • Send transactional mail with the templates of your choice.
  • Get professional and high-quality invoice designs for printing.
  • Get real-time updates on invoice mail.
  • Include direct CTAs for your clients to pay.

Also Read: Invoice and Payment Letter Templates

Businesses that Rely on Automated Invoice Processing API

Our platform is ideal for professionals and businesses to create and send invoices. 

  • Small Business Owners: They can automate their invoice generation process to print and eliminate manual data entry jobs. 
  • Operators: These professionals often work on a project-on-project basis. Our API help in creating and sending physical invoices to their clients. 
  • Accountants: These individuals can rely on our Print & Mail API to create physical invoices for their clients. For example, tax preparation, bookkeeping, etc. 
  • Legal Firms: Companies can rely on our automatic invoice processing software to bill clients for legal services.  
  • Healthcare Providers: Medical professionals can use our API automatically send bills to their patients, vendors, and suppliers.
  • Property Managers: Realtors can automatically send bill tenants for rent and utilities with PostGrid. Generate accurate invoices in seconds to reach your clients. 
  • Subscription-Based Services: Implement our API to print and mail monthly recurring invoices to your customers. 
  • Nonprofit Organizations: Nonprofits can rely on our automatic invoice processing software to release invoices to their donors or volunteers. 

Save Manual Work and Time with PostGrid 

You must purchase ink, paper, and envelopes to generate physical invoices. Then you have to manage everything from printing, packaging, and sending. 

You can outsource all your invoice printing and mailing to PostGrid to turn your hard work into intelligent work. Our automatic invoice processing system does all these at lesser costs and more efficiently. 

Boost Your Brand Reputation and Ensure Good Relations 

We enable your business to present itself more professionally with high-quality invoices. You can also brand your invoices and use them as marketing pieces to increase your brand visibility. Ensure consistent invoices with invoice process automation.   

Signup now to automate invoice processing and send your invoices. 

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