Solve B2B Payment Problems by Eliminating Checks, Reducing Risk & Saving Money with AribaPay

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B2B payments are broken! At the very least, they are a paper-intensive, high-touch endeavor that requires you to risk handling supplier bank accounts, deal with escheatment, and manage supplier inquiries. AribaPay, a new and unique method of B2B payment, leverages the strengths of both the Ariba Network and the Discover Network to solve the fundamental issues that plague B2B payments and prohibit you from moving more suppliers to electronic payments.

By giving your suppliers full visibility into the payment with rich remittance and payment track and trace technology, you can virtually eliminate checks and supplier payment inquiries while outsourcing your biggest source of payment risk: supplier bank account management.

Join this session to learn how AribaPay can fundamentally transform your B2B payments process while giving your suppliers what they really want: full visibility into information needed to reconcile as well as complete confidence in payment timing.

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Solve B2B Payment Problems by Eliminating Checks, Reducing Risk & Saving Money with AribaPay

  1. 1. Solving B2B Payments! Eliminate Checks, Reduce Risk & Save Money with AribaPay Tom Turkot, VP, Arlington Computer Products Mark Buchek, VP Arlington Computer Products Drew Hofler, Director-Solutions Marketing, Ariba March 19, 2014 #AribaLIVE @ariba © 2014 Ariba – an SAP company. All rights reserved.
  2. 2. Agenda • • 2 Introducing AribaPay B2B Payments – A Receiver‟s perspective © 2014 Ariba – an SAP company. All rights reserved.
  3. 3. AribaPay: Before and After Unintegrated  ‘High Touch’  Paper-Intensive  Opaque Purchase Order  Invoice ?  Remittance Advice   Existing Transaction Bank / Payment Check Issuance Provider Closed-loop  Secure  Auditable  Transparent  Trackable Purchase Order  Invoice  Payment with AribaPay 3 © 2014 Ariba – an SAP company. All rights reserved.  Remittance Advice
  4. 4. AribaPay: Contrasting to Other Payment Methods • • Unique value due to tight integration to „prepayment‟ business collaborations between Buyer-Supplier • AribaPay not intended to cover Wire transactions which are typically high-value, low-frequency payments handled manually by Buyer‟s Treasury function and Bank • 4 AribaPay is designed to be a better payment method for Ariba Network trading partners paying/getting paid by traditional ACH or paper check Subject to customer demand, Ariba functionality may add commercial card transactions integrated to Ariba Network transactions © 2014 Ariba – an SAP company. All rights reserved.
  5. 5. High-Level Flow AribaPay • AribaPay is a secure, global and scalable payment method that permits Buyers to pay their Suppliers and deliver rich remittance advice. • AribaPay is not a credit card offering. • Leverages Discover‟s trusted, secure and global payment infrastructure and ecosystem. 55 © 2014 Ariba – an SAP company. All rights reserved.
  6. 6. A Scalable Enablement Program Key to Success • Ariba works with Buyer directly to design, deploy and manage enablement and on-going support • Scalable and secure enablement infrastructure • Third party Merchant Acquirers, in partnership with Discover, will leverage processes and expertise to capture bank account details, validate Supplier organization, and identify proper individuals with authority to manage banking information. • Weekly, ongoing monitoring of AribaPay-enabled Supplier ensures bank account information is maintained, and risk/compliance 6
  7. 7. AribaPay: New Remittance Advice UI for Buyer and Supplier ‘Rich’ remittance information including every invoice accompanying payment. Created at time of Invoice Approval, which can be days or weeks before payment sent. ‘Clickable’ Invoice Summary information Opportunity for Supplier to spot payment issues sooner, assess internally and adjust receivable accordingly. For ‘problem’ payments unintentionally short paid, resolves disputes faster
  8. 8. AribaPay: New Remittance Advice UI for Buyer and Supplier ‘Track and Trace’ for payments shows payment status for every payment. Fewer ‘check’s in the mail’ conversations. Suppliers can assess payment status real-time, all the time, with date-stamping of messaging choreography. Complete error messaging protocol – failed payments have error messaging that can be used by Ariba Customer Support (hotswappable to Discover for payment issues) to resolve potential issues. Viewable by both Buyer and Supplier users. Both sides see same status/data.
  9. 9. AribaPay: New Remittance Advice UI for Buyer and Supplier AribaPay ‘logic’ compares incoming invoice value from Supplier to ‘agreed to pay’ value from Buyer. Differences highlighted with icon to draw user’s attention to problem invoices.
  10. 10. AribaPay: New Remittance Advice UI for Buyer and Supplier AribaPay native to Ariba Network transactions, so all Invoices, POs and related business transactions with Buyer in one environment. A single portal for Buyer’s PO, Supplier’s Invoices and now payment transactions …and underlying information.
  11. 11. AribaPay: New Remittance Advice UI for Buyer and Supplier Information may be printed or downloaded via cXML to user’s systems. Ariba will also make available ‘integration’ solutions to populate backend accounting packages such as Microsoft Dynamics, QuickBooks, Great Plains, etc.
  12. 12. AribaPay: New Remittance Advice UI for Buyer and Supplier Payment directly to Bank Account of Supplier’s choice. No change in Buyer’s – or Supplier’s – bank account required to support AribaPay
  13. 13. AribaPay Benefits Buyer • „Per payment‟ cost amounts may vary greatly from company to company (and cost may be blended into other financial provider offerings) • Fees include… • Fewer paper checks • Fewer supplier payment enquiries • No more handling supplier bank accounts • Payment method focuses Supplier mind on B2B enablement • Less escheatment • Deep integration to pre-existing Ariba Network transactions (PO, Invoice) • Leveraging Discover ecosystem capabilities around anti-money laundering (AML), Office of Foreign Asset Control (OFAC), and other risk elements as regulatory environment increases in this area 13 © 2014 Ariba – an SAP company. All rights reserved. Bank Transaction Fees Supplier Bank Account Management ACH and/or Check Processing Fees Postage, Check Printing, Storage, Paper Handling, Other Paper Costs • Escheatment • FTE Expenses (reconciliation, supplier payment enquiries, dispute resolution, bank account management) • • • • • Lower processing costs, no AribaPay transaction fees * Ariba Estimate. Sources: EMC Consulting analysis, FRB, NACHA, IBM, McKinsey US Payments Map, expert interviews, Discover data
  14. 14. AribaPay Benefits Sellers • „Per payment received‟ costs amounts may vary greatly from company to company (and cost may be blended into other financial provider offerings) • Fees include… 14 • Bank Transaction Fees • Lockbox or financial provider AR fees • Remittance Advice management, reconciliation efforts • Discovery of short-pays, resolution of disputes • FTE Expenses (reconciliation, supplier payment enquiries, dispute resolution, bank account management) • Richer remittance advice permitting faster reconciliation • Reliable view of future payments, reducing collections team efforts • Payment „track and trace‟ • Better auto-reconciliation rates • Lower payment processing costs • Earlier discovery and resolution of problem payments • Better reporting • Stronger perception of value of Ariba Network transactions * Ariba Estimate. Sources: EMC Consulting analysis, FRB, NACHA, IBM, McKinsey US Payments Map, expert interviews, Discover data 14 © 2014 Ariba – an SAP company. All rights reserved.
  15. 15. Recent Quotes* from Existing Ariba Network Supplier • “This is exciting – this is a key pain point for supplier for sure…” • “The value proposition is there. Anything that reduces the time to reconcile and find short payments is worthwhile” • “We need both sides to participate”… “How many out of those 70 buyers we have [on Network] that we are invoicing will do this?” • “We would be interested to participate in the design phase” but “will need to know more about costs, pricing after design phase, buyers who will use…” • “…What it will help with is our collections and our cash applications – with my remittance application today I don‟t know offhand what is my cost of operations…” * August 5, 2013 discussion with large US-based retail Supplier 15 © 2014 Ariba – an SAP company. All rights reserved.
  16. 16. Suppliers Can Connect to Back-end Systems with AribaPay-enabled integration packages from Dell Boomi • AribaPay will offer „out of the box‟ connectivity via Dell Boomi integration packages to present seamless integration of AribaPay Payments and Remittance Information to Supplier‟s most popular back-end systems • Future Payment Visibility Payment Remittance Advice 16 © 2014 Ariba – an SAP company. All rights reserved. • Faster Reconciliation • Spotting Problem Payments Faster • Faster Dispute Resolution • Integrated to Supplier‟s Back-End Systems
  17. 17. Tom Turkot, VP, Arlington Computer Products Mark Buchek, VP Arlington Computer Products B2B PAYMENTS: A RECEIVER’S PERSPECTIVE 17 © 2014 Ariba – an SAP company. All rights reserved.
  18. 18. ACP Company Background • • • Founded in 1984; 30 years of Financial Stability Delivered over $1.5 billion in IT Solutions Outstanding Technology Partner Relationships • • • • Enterprise-oriented Customer Base with strong Public Sector and Commercial Accounts Customer Champion-Vendor Neutral Entrepreneurial Based • • • 18 HP, IBM, Cisco, Juniper, MS, Apple, Dell… Personal, Responsive, Flexible, Proven Track Record HQ – Chicago, Reg. Offices – Atlanta, Milwaukee, Intl. - London Excellent Customer References © 2014 Ariba – an SAP company. All rights reserved.
  19. 19. ACP Invoicing Overview • • • • • • 19 Average monthly invoicing over $11 million Over 2,000 invoices average per month 5 FTEs support the invoicing process Average cost of sending a manual invoice = $5 Lockbox costs Ongoing collection efforts © 2014 Ariba – an SAP company. All rights reserved.
  20. 20. ACP Current Invoicing and Payment Pains • • • • 20 Inconsistency of payments Delays in collection Manual process of posting payments A/R Aging gaps due to delays © 2014 Ariba – an SAP company. All rights reserved.
  21. 21. ACP Current Invoicing Work Flow • • • • • • 21 Sales Team inputs an order into the system Accounting processes the order Purchasing places the order with distributors Invoice generated through the system Invoices manually stuffed and mailed Remittance processing both manual and through a lockbox and payments posted to the accounts © 2014 Ariba – an SAP company. All rights reserved.
  22. 22. ACP Perspective on AribaPay – Why Join? • • • • • • • 22 Begin the process of automating invoicing and payments Initiate Re-architecting Accounting Processes Decrease days sales outstanding Decrease Administrative Costs Gain consistency in payments Leverage the strength of the AribaPay Network Eliminate manual processes © 2014 Ariba – an SAP company. All rights reserved.
  23. 23. ACP Perspective on AribaPay – Additional Benefits • • • • • 23 Improved application of funds Eliminate the need to send duplicate invoices Improved visibility throughout the payment process Reduce Collection Efforts Improved Cash Flow © 2014 Ariba – an SAP company. All rights reserved.

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