Every company wants to find ways to save time and money so they look for the right supplier from whom they can get the best possible deal. Supplier networks allow companies to access a selection of vendors and sort through them according to their preferences and thus have become essential to compete in today’s business environment. A study conducted by the Aberdeen Group found that companies using supplier networks can increase spending under management while reducing costs related to poor supplier performance.
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So what is a supplier network?
A supplier network is a virtual platform where suppliers and buyers located anywhere in the world can collaborate and do business together. They help buyers discover suppliers who match their needs, speeding up the procurement and resulting in timely selection of goods, delivery, and payment. Supplier networks give buyers options from which they can select suppliers according to their preferences (products, prices, location, etc.), thus reducing costs and increasing profits.
Generally, companies like supplier networks for a few reasons, including:
- Reduction in purchasing cycle times
- Reduction in paper invoice volume and manual processing
- Increased visibility of order, invoice, and payment status
- Better contract terms
However, while a supplier network may help you achieve those goals, if you are trying to realize all of the benefits of AP automation, supplier networks offer only a partial solution. Among the points you should consider:
- Supplier networks will only address the invoices of those who participate in the program, leaving all other invoices to be manually processed
- They can be messy and labor-intensive, placing a burden on your already busy employees
- Asking vendors to pay a third party to submit an invoice may create friction in your supply chain and damage vendor relationships
- Supplier networks may require significant internal training time.
If supplier networks are only a partial solution, what else can you do to improve the performance of your AP process and increase AP automation?
Instead of using a supplier network, you can work with a third party to handle the cumbersome task of scanning all your invoices through a full-service digital mailroom combined with OCR. Why is this a better option? Because supplier networks require suppliers to change their billing practices, something that has proven to be unrealistic to achieve across 100 percent of vendors, even for some of the largest companies in the world. The last thing you want to do is ask your critical vendors to jump through hoops to give you a little added efficiency.
If you could optimize your AP automation, streamline processes, and save time and money all while you preserve your vendor relationships, wouldn’t that be a better option? DataServ not only values our relationship with your organization and your employees, but we understand how important your organization’s vendor and supplier relationships are. You can preserve those relationships and maintain efficiency through AP automation. Our paperless OCR-intake approach delivers clean and usable data – all while ensuring 99% pre-ERP accuracy. We give you a digital stream for purchase orders, invoices, and receipts, so there will be very little time required from your staff, vendors, and suppliers to interact with our AP processes. If you can get the benefits of a supplier network without the downside, that truly is the best way to save time and money.
To learn more about DataServ’s APIA solutions, contact us today.