Why your supply chain invoices are out of hand

Managing supply chain invoices is still a surprisingly manual process. Records are kept in spreadsheets, individual team members spot-check individual invoices and errors slip through the cracks and start to build up. With what it takes for supply chains to run these days, keeping on top of every single invoice from each supplier and each delivery is impossible. It’s a seemingly endless task, but what else can you do?

Well, more than you think probably.

The first step toward solving the problem of invoice overwhelm is understanding just exactly how you got to this point. There are better, more effective ways to manage your invoices, but you’re facing hurdles that keep you from getting there.

What gets in the way

 

Lack of resources

One of the main problems we see companies come up against is a lack of resources. Particularly in terms of manpower and IT expertise. Invoices can create an absolute deluge of data from delivery and charge information. When used well, this data can be used to make smarter decisions about how best to move your goods. Unfortunately, teams often have too much incoming data to review and analyse manually. 

Lack of IT resources, on the other hand, usually means there is a separate IT team and supply chain optimisation isn’t a priority project for them. That means only projects with no IT set-up are viable for many supply chain and logistics teams.

 

Complex dispute processes

With most providers, dispute processes are lengthy and not an efficient use of people’s time. The cost of time spent chasing and creating disputes manually can counteract a surprising amount of the returns. We have found that at least 3-5% of logistics spend is lost and can swiftly be recouped by a more effective disputing of charges.

 

Managing providers

Gaining control over suppliers is a significant challenge. This is true regardless of how many relationships you’re trying to manage. Of course, one way that organisations can get the best rates from third-party providers is to use a multicarrier strategy. 

However, managing more than one provider adds levels of complexity. For some, the manual effort needed to stay on top of multiple providers can be overwhelming. Especially if you are struggling to ensure you’re getting the level of service you’re paying for. 

 

No baseline data

Not having baseline data to compare your logistics performance to can have far-reaching impacts. We’ve seen up to 20% cost and service variance between carriers. That means companies without an effective way to baseline or standardise can lose out without realising. It also means there is no clear foundation for digitalising and future-proofing your supply chain. 

 

What you can do about it

Increase manpower

One, fairly straightforward, solution is to grow your team. More people means more availability for managing your invoices and provider relationships. With more people on your team, you can check and dispute more invoices, better manage your providers and, possibly, help optimise. That said, this solution doesn’t necessarily help you define your baseline data. 

 

Invest in your future

Alternatively, you can start resolving all of those issues and realise returns instead of just more costs. Investing in intelligent decision-making tools that can give you rapid results is a big part of digitalising your supply chain, but getting started can be easy with AI. For example, our invoice auditing tool ingests your invoices and then can nearly immediately start identifying opportunities. Such as ensuring that you are only paying for the levels of supplier service you’re receiving. Customers using invoice auditing from 7bridges reduce carrier variances of up to 20% immediately and show a 3-14% improvement to costs from current providers.

On top of all that, this can act as a starting point to integrate AI and automation into your supply chain for long-term success. Getting control of your invoice data increases the overall visibility of your logistics performance. It offers a holistic view of supplier performance and costs and creates a baseline layer of data on which to base decisions.

So, even though your invoices are a huge time and resource sink right now, they don’t have to be. Investing in a quick win, and resource-light solution to enable you to take the first step towards transforming your supply chain.

 

Want to know more about how we sort out your invoices here at 7bridges? Check out this whitepaper all about our invoice auditing.

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