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Why Hospitality Should Consider e-Invoicing


The hospitality sector is unique. No other industry is so service led, where small personalized touches can make or break a business. No other industry is as far ranging in business type, from international hotels to bijou cafes, chain restaurants to major airlines.  And no other industry is so affected by the global economy and changing purchasing patterns.

Due to the individualized nature of hospitality businesses, using technology to enable improvements can sometimes be difficult. Yet the nature of hospitality businesses means the devil really is in the details, and without these details a business will struggle to reach its full potential and ultimately to succeed in what is a hugely competitive marketplace. In this article, CloudTrade will discuss why hotels and restaurants should consider the benefits of e-invoicing.

Take a restaurant for example. It is a reactionary business, responding to customer choices with limited foresight to anticipate purchasing behaviour. In this situation it is difficult to raise Purchase Orders and be structured in purchasing – if you unexpectedly run out of tomatoes, you need to get more! Other industries can be very staid in terms of their purchasing processes, but hospitality organisations must be immediately responsive to customer demands to stay in business.

In the above scenario, restaurants will very often have no record of what was bought until the delivery note or invoice. And in fact, it is only when the invoice is received that the business will have any level of detail regarding purchasing. It is for this reason that line-level invoice data is essential to hospitality businesses.

There is a big push in the hospitality industry, as a whole, for management information (MI) to enable business improvements; to gain more foresight, become less reactionary. Line-level invoice data is what will enable hospitality businesses to access the information they need.

With line-level invoice data, a business can understand what is selling well, patterns in purchasing, problems in bookings. With this detailed data an organisation gains insight in to the profitability of different areas of the business, or different dishes on the menu – depending on the nature of the business.

A travel agent, for example, may block-book hotel rooms or other travel services. It is only when the company receives a line-level, detailed invoice back that they can see exactly what has been booked and what really occurred – did the guests arrive? Did they check out early? Stay longer? The line-level data enables the travel agent to cross-reference what was booked with what actually happened.

Without line-level detail within invoices, organisations lack the detailed management information they need to make business improvements, enhance profitability, and remain competitive.  For businesses in the hospitality industry, the devil really is in the details to ensure continuing market success.

In addition, much of the hospitality industry is still bogged down by paper invoicing. The gains to be made to businesses by moving over to electronic invoicing are immense, however the nature of the industry means that many suppliers are just not in a position – financially or technically – to move to an EDI system. However, there are ways to move towards e-invoicing without the need for significant investment on the part of suppliers. Marketboomer, the APAC based procure-to-pay (P2P) solution provider, for example, has integrated a PDF invoicing solution within its P2P solution which enables suppliers to email a PDF invoice for processing electronically. Accor Hotels is one group to benefit from this solution which can make e-invoicing a reality to the clear majority of hospitality organisations.

“One of the keys to the success of the project has been to achieve high adoption rates and to on-board our suppliers as quickly as possible,” says Darren Pike, ecommerce Manager at Accor Hotels.

Traditional Electronic Data Interchange (EDI) solutions require a huge investment to get off the ground and in-depth technical knowledge to establish within supplier’s business. On boarding to EDI can be complex and once a system is in place, it can quickly become a rigid constraint for a business, as it’s so costly to change and update to accommodate new requirements.

In reality, many suppliers to the hospitality industry are just not in a position to on board this type of system. PDF invoicing is a viable alternative for these suppliers. Invoices are raised in their existing system, they just create a PDF of the invoice and email it over to the supplier. Data mapping technology takes the information directly from the PDF and maps it straight in to the invoicing system without any manual keying. And because the data is taken straight from the original supplier’s invoice, the data that reaches the invoice processing system is 100% accurate so there is no time spent on manual data corrections.

The process of on-boarding to this type of e-invoicing is very simple meaning extremely high on-boarding rates are achieved, and suppliers can be up and running within minutes, something no other e-invoicing solution can do.

Moving to electronic invoicing with line-item detail results in quicker processing, eliminates manual entries and the associated errors, and eliminates all paper from the invoicing process. There is a significant reduction in administration costs and the time associated with printing, postage, data entry and document handling. Line-item details reach the organisation at an earlier point providing much needed visibility in to purchasing patterns on which to make informed decisions and improve profitability.

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