This presentation provides a brief introduction to the area of e-Invoicing and provides an overview of the various country specific regulations that exist today which describe how e-Invoices should be processed. Particular focus is placed on Mexico, Brazil and Europe as these regions have very specific e-Invoicing related regulations which manufacturers must obide with. Updated May 2014
Hello and welcome to this webinar hosted by GXS, my name is Mark Morley, Industry Marketing Director and I am joined today by my colleague Nigel Taylor, Director of Marketing and head of e-Invoicing Solutions at GXS.Over the next few minutes Nigel and I will be discussing how manufacturers can improve their support of e-invoicing. Today’s manufacturing companies are scattered all over the world and they typically work with many trading partners who may be located in key manufacturing hubs such as China, Brazil, Mexico or potentially any one of the 27 countries that make up the European Union. As manufacturers enter new markets and they try to automate their manual paper based invoicing processes, it becomes more important than ever before to understand country specific e-invoicing regulations. Whether applying digital signatures, archiving or adhering to tax compliance regulations, nearly every country will handle e-invoice compliance in a different way.This webinar will help to explain what e-Invoicing is and how it should be deployed. Given the current exponential growth in new manufacturing hubs in Brazil and Mexico we will discuss some of the regional aspects of implementing e-Invoicing in these particular countries.But before we start, let me just outline a brief agenda for this session.
I will start by discussing some of the key trends impacting today’s manufacturing companies and the B2B challenges they have to address.Nigel will then provide a high level introduction to e-invoicing and he will discuss some of the country and regional variations of deploying an e-invoicing solution.I will then discuss some of the industry focused e-invoicing initiatives that are being undertaken today across the automotive and high tech sectors before finally closing this session with a few examples of how companies have been deploying the GXS e-invoicing solution
So let me begin today’s session by looking at some of the key manufacturing trends around the world and why there is an increasing need to support e-invoicing in different countries
Manufacturing related supply chains have been impacted by many external forces over the years, from the global recession, to human rights issues and strikes in China, from natural disasters to the so called omni-channel effect that is changing consumer buying patterns. Manufacturers have had to build increased flexibility and agility into their supply chains so that they can address these and any future business challenges.
Over the last decade, western manufacturers have expanded their operations into emerging markets such as China and India. Enticed initially by low labour costs and access to a vast pool of workers, these companies prospered for many years. Now with increased wage rises and strikes in China, combined with the natural disasters in Japan for example, some companies have decided to near shore production back to their home markets. Moving forwards it will be China that leads the continued globalisation efforts, setting up new plants in Brazil and Thailand for example, but one major issue they face is understanding regional B2B standards and trying to onboard new suppliers quickly.If a company is looking to establish a manufacturing facility in Brazil for example, they will need to onboard trading partners quickly, integrate to corporate business systems and work with different regional B2B or EDI standards, whilst at the same time adhering to local business laws or regulations. Manufacturers need to work with a B2B vendor that can help remove the complexity of establishing an operation in a new market, a vendor who can work with them on a truly global basis through a single cloud based B2B platform. So as you can see on this slide the manufacturing sector is truly global in nature and supply chains need to have flexibility and scalability built to support expansion into new markets. Being able to partner with a B2B vendor that can help remove the barriers of doing business in any country worldwide, especially when trying to understand country specific regulations with regards to e-invoicing, can provide a significant competitive advantage in the market.
GXS works with many manufacturing companies around the world and before we discuss how we can help address your e-Invoicing requirements, let me briefly explain how we help manufacturers address specific B2B challenges Continued merger and acquisition activity across the industry is leading to manufacturing companies needing to consolidate multiple or legacy B2B networks across their business on to one common platform. B2B hub consolidation presents the ideal opportunity to re-evaluate B2B requirements and quite often an outsourced consolidation approach could be seen as being a preferred option to a behind the firewall software based approach As manufacturers build new plants around the world, there is a continued need to provide connectivity to global manufacturing hubs and trading partners around the world. Whether working with trading partners in North America, South America, Europe or the Far East, being able to mediate between different communication protocols and document standards is a key requirement to ensure the success of global expansion projects- ERP systems are at the center of nearly every manufacturing operation and a company can realise significant benefits if they integrate their ERP and B2B systems together. ERP systems are critical to the smooth running of today’s production lines and inventory management systems and traditionally an ERP instance would be setup in each manufacturing plant. ERP consolidation is a key initiative being undertaken by many manufacturers today and moving towards a single, global ERP instance is a priority for many CIOs. ERP consolidation provides the ideal time to consider integration with a cloud based B2B platform.
As manufacturers look to expand into low cost emerging markets they need to onboard suppliers in these regions as quickly and smoothly as possible. Due to limited IT skills in these regions, suppliers must be on-boarded with simple to use and quick to deploy B2B tools. They will also need on the ground support to contact trading partners and ensure they can connect to a central B2B platform. Finally they will need to offer 24/7 multi-lingual support to ensure that any potential problems with accessing or using the B2B platform can be resolved.Globalisation of manufacturing supply chains has meant that it has become more important than ever before to improve visibility into the shipment of their goods, in both the distribution of new goods and shipment of service parts across the aftermarket sector. Being able to track the shipment of production and aftermarket parts across 3PL providers and being able to notify a customer of when these shipments will arrive is a key way to improve customer satisfaction levels. Finally, recent natural disasters have led to a need to improve the way in which companies respond to supply chain disruptions. Manufacturers should ensure that they have a central repository of up to date contact information so that they can reach out to a trading community during a period of disruption. Improved communication and collaboration with a trading partner community helps to increase supply chain resilience.
Traditionally a manufacturer’s trading partner community would potentially have to connect to a multitude of different business systems and from an integration point of view the point to point connections become very complex, very quickly.By connecting your external trading partners to a cloud environment, such as GXS Trading Grid the world’s largest cloud integration platform, means that they have a single point of contact into your organisation and they can get access to a highly available, web based set of tools for exchanging business documents electronically.
In addition to the six areas I mentioned previously, a further area of complexity is to understand how to adhere to the numerous e-Invoicing compliance standards around the world.For example how is tax compliance treated in France versus the UK and how long do e-Invoices have to be archived in Germany versus Spain.Many companies have been using traditional EDI as the basis of their e-invoicing process but what benefits would a dedicated e-invoicing provider offer to a manufacturer with trading partners all over the world?
At this point in the presentation, I will hand over to Nigel who will provide an introduction to the area of e-invoicing and the regional challenges of implementing these particular solutions.
Depending on where you are in the process you will have a different perspective of electronic invoicing. Starting from the right… Sellers continually strive to reduce their days sales outstanding, that is the amount of time it takes to receive payment from their customers for the goods or services they provide, commonly known as the order to cash cycle. Your company has shipped the goods or service and is issuing electronic invoices to your many customers through your receivables department, ultimately, the customers pays you. This is known as business to business e-Billing, and the focus is on reducing overheads and ensuring payment is received on time. On the opposite side, buyers are concerned with ensuring that everything is in order before payment is made… this is known as the order to pay cycle, and the length of time taken is understood to be the days payable outstanding. In this scenario your company is receiving electronic invoices from your many suppliers in your payables department, you will check if the goods have been delivered, and in good order and will compare to the original purchase order, if everything matches then you will pay the supplier. This is known as e-Invoicing and the focus is on reducing overheads and gaining visibility into the process. The new electronic invoicing models automate both buyer and seller, they simplify both trading parties’ end-to-end processes, and it is e-Invoicing and B2B e-Billing that provide the platform to remove paper, and to capture the cost savings that will directly impact your companies’ bottom-line.
Thanks Nigel, the final section of this webinar briefly reviews some of the industry specific e-Invoicing initiatives that are taking place today and I will then finish this session with a few examples of companies who have deployed e-invoicing.
The final example that I wanted to highlight is enliteB2B, developed as a messaging standard for the smaller suppliers across the high tech industry. More than thirty data models have currently been developed to represent nearly all the key message flows across the high tech industry. One of the first messages to be specified was the invoice as it has one of the more complex data models. The project was the output from one of the workgroups of the EDIFICE organisation, a global industry association looking after the B2B requirements of high tech companies around the world. The enliteB2B message set has been developed by the high tech industry, for the high tech industry and obides by three key principles, messages must be human readable, any language can be used to define and use the messages and any spread sheet program must be able to open the message. The introduction of enliteB2B to the market is at the early stage but as with auto-gration in the automotive industry it is expected to gain traction quickly across the high tech sector.
Automotive Supplier - This company is a global supplier of interior systems to the automotive industry with 260 manufacturing locations around the world. Many of their customers including Ford and GM have established new plants in Mexico, one of the world’s fastest growing automotive hubs. GXS Active Invoice With Compliance was chosen as the preferred solution to allow this company to adhere to the specific e-Invoicing regulations in Mexico.GXS has also been chosen as the preferred e-Invoicing provider to support their other manufacturing locations around the world.
If you would like to learn more about e-Invoicing then please visit our dedicated website where we have pulled together a number of resources to help companies who may be looking to deploy an e-Invoicing solution for the first time.Please visit www.einvoicingbasics.co.uk