Why E-Invoicing?

The digital era in commerce has given rise to many new and innovative business techniques which are effective as well as productive. One such automated business tool that has worked in favor of business is Electronic invoicing. This modern process allows smoother flow of business. It has helped remove the complexity from the accounting procedure and also improves the relationship between business and clients.

Normally in traditional method of invoicing, when a customer purchases some product from the supplier, he would be provided with a bill or an invoice which would include the cost of the product and the time to pay. Before sending the bill to the customer, the supplier has to follow various tedious procedures like entering the invoice information in his book keeping account, print the invoice, copy it and send it across for auditing purpose and finally mail it to the customer and check the mails every now and then for the payment status. On the other hand, the customer has to enter the supplier and expense code in his accounting book. Apart from this the customer has to tackle updating the purchase orders. This whole process while hearing itself sounds so mind-numbing imagine following this process will be so arduous. Loss of data, human errors while data entry, duplicate invoices, late payments are the common problems encountered with customary invoicing method. Every business person who has followed the traditional method and currently is using the modern technique would undoubtedly understand the huge difference between these two processes. Online invoicing is a relief factor for all the small as well as big businesses. Even the customers can enjoy various benefits of e-invoicing.

What is e-invoicing?
Before discussing, why online invoicing is useful, let us first understand the concept of e-invoicing. E-invoicing basically means an invoice which is sent and received electronically. It is a fully automated process and does not involve any paper work. Issuing, calculating, preparing, sending, receiving, the complete billing procedure is managed online. Therefore this technique helps in easy payment and also saves the time and energy. The transactional documents exchanged between the supplier and the customer can be in form of XML, EDI or CSV files.

Why E-invoicing?
Now it’s time for the million dollar question, why to switch to e-invoicing? Every transformation is guaranteed with benefits and the same goes with e-invoicing. Time is the most essential factor for any business. Online invoicing is less time-consuming and very effective.  The significant benefit offered by e-invoicing is cost saving. It reduces or eliminates the stationary cost, labor cost etc. All the accounting duties are done fast and that too without any errors. As calculation is done automatically, it eliminates human errors. You can have greater control over the cash flow. The process guarantees speedy and timely payment. Unlike traditional invoicing method, there is no issue of data loss as the data is stored with the help of electronic means and even backup is easily available. It is also a green way of business as it reduces the usage of paper.

When such a better alternative is available then why stick to the old and tedious technique. Freelancers to large scale companies everybody is now switching to e-invoicing since it is one of the most effective accounting techniques.