Purchase-to-Pay: Digitalization in Purchasing

Purchase-to-pay is an important business process that can be made significantly more efficient when fully digitized. With Retarus Integration and Automation, any company can save money and lay the foundation for economic growth.

From Purchase to Payment

Purchase-to-pay (P2P), sometimes also referred to as procure-to-pay, describes a company’s entire procurement process. This workflow consists of a large number of different individual operations. These include:

Purchase requisition
The purchase itself
Receipt of the ordered goods
Payment
Accounting

All of these individual process elements are connected through the transfer of their corresponding data. The large number of organizational units involved makes the entire workflow very complex. There is an enormous expenditure of time and personnel costs with manual processing. Not to mention, with manual processing comes the high risk of error.
The solution is an end-to-end digital and automated purchase-to-pay process that encompasses the company’s entire workflow up through final payment. By eliminating manual processing steps and implementing a new standardized approval process:

Sources of error are minimized
Transparency in the process is increased
Efficiency is maximized and costs are reduced

A digital purchase-to-pay process essentially consists of four pillars:

E-Procurement

A computer-assisted purchasing process is often referred to as e-procurement. Requests are usually generated via stored catalogs. The function and look-and-feel are similar to classic online stores. This means that every employee can easily integrate the system into their own workflow. At the push of a button, the order is transmitted to the supplier as structured data.
If the supplier does not support structured data, the order is sent by email. Ideally, approval and account assignment are already carried out when the order is initiated. This means that no further approval is required to automatically post the invoice.

Electronic Exchange of Documents

To prevent media disruptions and thus save time, all documents should be exchanged as electronic data. This not only offers saving in personnel costs, but also protects the environment. To ensure a smooth process, all senders and recipients are directly linked to each other. This enables the software to uniformly convert, validate, and transport the documents to the desired location.

Invoice Automation

To automate the entire enterprise P2P process, invoice processing is also optimized. This means all invoices from various suppliers are initially converted into uniform e-invoices. The software then uses predefined rules to compare the invoices received with orders placed or payment agreements made and goods received. If all the data matches, posting takes place automatically.

However, if the system detects discrepancies, an approval workflow is initiated and the appropriate person(s) are contacted. If no contact person is stored and no reference is named on the document, a responsible employee is requested.

Electronic Payment

The final step in a digital P2P solution is electronic payment processing. To do this, external payment service providers are integrated into the company’s system. Unlike traditional online banking, the intelligent system can include favorable payment deadlines and discounts. As a result, the software supports working capital management and saves hard cash.

Depending on the supplier, external financing or e-payment services can also be integrated, enabling interim financing or dynamic discounting programs.

The Benefits of an Automated P2P Process

Installing a modern P2P system with Retarus Integration and Automation offers many advantages. For example, the ability to transfer PDF files or faxes as structured data directly into the ERP system saves time and money. The digital internal flow of information ensures greater transparency, while automation reduces errors.

High Cost Savings

The manual transfer of data is associated with high personnel expenses and thus represents an enormous cost factor for companies. A reliable software solution can reduce the manual effort and associated costs. Purchasing managers can aggregate individual purchases and negotiate appropriate discounts because of better insight into the data. The overview of early-payment discount offers and the integration of attractive e-payment solutions also bring further financial benefits.

More Clarity

In everyday life, few finance managers know where individual supplier invoices are located or whether ordered goods have already arrived. Additionally, processing inquiries takes a long time. With an intelligent digital solution, responsible employees can not only track all processes, but also manage them. At the same time, management gains a better overview of financial trends and achieved KPIs by the individual departments.

Fewer Errors

With automation instead of manual transmission, human errors are also eliminated. When processing invoices in particular, mistakes can have grave consequences such as payments for incorrect amounts or to the wrong suppliers.

Retarus for Automation of P2P and O2C Process Chains

E-invoicing is often the first step companies take towards a digitalized purchasing process. However, electronic invoice processing is only one part of e-procurement. To leverage the full potential of an automated P2P process, as many workflows as possible must be converted to electronic processing. This is precisely why Retarus offers its Integration and Automation services, which meet all international e-invoicing requirements (B2B and B2G) for both sending and receiving invoices. Retarus’ Long Term Archiving Service guarantees compliance for more than 50 countries with a separate portal and redundant data centers for legally compliant document storage. Thanks to networking with platforms such as Ariba or OpenPeppol, comprehensive digitalization can be achieved without any problems.

Digitize Order Forms and Automate Processing

With the help of Retarus Intelligent Document Processing, incoming orders can be digitized and highly automated.

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Digitize Invoicing Processes Intelligently

Use Retarus Integration and Automation to send and receive invoices internationally and in compliance with legal requirements.

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