Accounts Payable Trends

1. 2016: Account Payable
Trends for Local Government

2. 2
The AP trends of 2016
trend #1
Cloud
momentum
trend #2
Reporting
visibility
trend #4
Mobile
processing
trend #5
E-invoicing
penetration
trend #6
Outsourced
payments
trend #3
Centralized Invoice
Receipt

3. Cloud

4. 4
of all organizations are planning
to move to a cloud-based accounts
payable system in the next two years.
Cloud is growing
Source: IFO 2015
Cloud penetration is close to
100% 24%

5. 5
Development is stable
Customers
You need to stay ahead of the complexity curve
Orders
Invoice
complexity
SaaS
On Premises

6. 6
Myths vs Reality
Unstable Myth Stable Reality
A passing trend
Limited functions
Focused on SMBs
Low reliability
IT unfriendly
Growing at 40% per year
Easily customizable
Scalable to any size
Fewer disruptions than in-house
Reduces tactical maintenance
vs

7. 7
Cloud simplicity
5 Quicker ramp up time
4 Lower cost per invoice
3 No software or hardware
2 Minimal IT involvement
1 Little or no capital investment
Source: IFO 2015

8. Visibility

9. 9
AP departments put visibility
surprisingly high in their list of priorities:
Amajor challenge?
Lack of visibility
into invoices and
payables information
45%
Difficulty handling,
managing and
finding invoices
42%
Costs to process
invoices are too high
38%
Maximizing
vendor discounts
17%
Source: IOFM 2014 Controller’s Report

10. 10
challenge #1
Key information
not captured
challenge #4
Badly integrated
systems
challenge #2
Poorly organized
data
Because there’s an information hole
challenge #5
No access for
decision makers
challenge #3
Information
not timely

11. 11
Source: Ardent Partners 2015
Identified or negotiated savings
Enterprise goals and objectives
% of spend under management
Booked savings
Enterprise spend
59%
56%
55%
50%
50%
"Strong Visibility"
The need for better visibility into spend

12. 12
0% 5% 10% 15% 20% 25% 30% 35% 40% 45%
Faster turnaround
Better process transparency
Better auditing
Staff reductions
Fewer invoices "lost in the loop"
Enhanced supplier relationships
More early-payment discounts
Fewer payment errors
Fewer disputes
Ability to outsource
Source: AIIM
Biggest benefits from AP automation

13. Centralized Invoice Receipt

14. 14
Centralized invoice receipt
Fax
e-invoices
e-mail
Mail
ap@co.xxxxx.mn.us
Centralized Mail Box
Primary Contact
Potential
Bottleneck
Benefits:
- Understand Outstanding Liabilities
- Accurately Diagnosis Issues
- Identify Process Weakness

15. Mobile

16. 16
Deployment is becoming standard
Source: IFO 2015
of all organizations are
planning to deploy mobile
capture and approval of
invoices in next two years.
28%

17. 17
Introducing mobile
Align with key
workplace trends
Speed up
payments
Support
BYOD policies
Increase
accuracy

18. E-invoicing

19. 19
E-invoice transmission

20. 20
Implement in 12 Months
16%
13%
29%
Currently Using
49%
21% 22%
Move to e-invoicing
Invoice Receipt Management Report 2015: PayStream Advisors Report
Front-End Imaging
OCR/Automated Data Capture
E-Invoicing Capability/Network

21. 21
The opportunity is huge
Current situation
of organizations
report no more than
55%
of invoices achieving
true straight-through
status
5%
Desired situation
of organizations
report more than
5%
of invoices achieving
true straight-through
status.
75%

22. 22
Most organizations believe AP
is the most manual F&A function
Yet…
And organizations are ready to act
Most organizations believe AP
is the F&A function best suited
for automation

23. 23
Six supplier focused strategies
Target All Suppliers
Avoid focus entirely on big
suppliers. The idea they provide
most invoices is losing face.
Supplier Focused Solution
Get diverse sending options
and supplier-focused features
at no cost
Automate at Consistent Pace
Understand some suppliers
need to evolve to e-invoicing
over time
Invoice Receipt
Method Diversity
Allow suppliers to choose
different invoice methods as
on-ramp to automation.
Find B2B Network with
Supplier Value
Look for self-service
functions and information
transmit options.
Implement Additional
Invoice Management
Receiving e-invoices is
step one: think matching,
approval, payments etc.
Invoice Receipt Management Report 2015: PayStream Advisors Report

24. 24
Types of supplier network models
MODEL
SUPPLIER RESISTENCE
LEVEL
SUPPLIER % OF SPEND MODEL
• Buyer pays implementation fee
• Supplier pays a % of spend
• Buyer pays a per invoice fee
HIGH
SUPPLIER FLAT FEE MODEL
• Buyer pays implementation fee
• Supplier pays flat monthly fee
• Buyer pays a per invoice fee
MODERATE
SUPPLIER FREE MODEL
• Buyers pays NO implementation fee
• Supplier pays nothing
• Buyer pays a per invoice fee
LOW

25. 25
Paper to Electronic
50
50
100%
0%
50%
25%
75%
1 Year 2 Year
E-invoicing
Paper Conversion
10
90
30
70
E-invoicing
Paper Conversion

26. Payments

27. 27
General Business Advantage
Leverage Rebates
Card
= 13,000 annual payments (26%)
Payment Composition
Check
Card
ACH
Check
Card
ACH
Drive down costs
x 1.3% AP card rebates
_______________________
$19.5m @ $1 ,500/payment
$253,500 Annual rebate

28. 28
Outsourced payment processing
2016 will see:
Payment
Outsourcing supplier payment will lead to:
Lower payment costs
Extra working capital finance
at lower rates
Reduced risk from volatile
supply chain activities
Increased access to
supplier discounts
Easier administration
and reporting
Extra working capital
flowing through system
Tighter bonds between
business partners

29. Summary

30. 30
The AP trends of 2016
trend #1
Cloud
momentum
trend #2
Reporting
visibility
trend #4
Mobile
processing
trend #5
E-invoicing
penetration
trend #6
Outsourced
payments
trend #3
Centralized Invoice
Receipt

31. About Corcentric

33. Eric Kallies
(856) 406-3469
ekallies@corcentric.com
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