Supplier invoice management plays a central role in spend management, regulatory compliance and improving supplier relationships. An optimised invoice processing system not only helps control costs but also strengthens the company's overall performance.
What is supplier invoice management?
Supplier invoice management refers to all operations relating to the receipt, recording, processing and payment of invoices issued by suppliers. Each supplier invoice must contain mandatory information and comply with a precise format to guarantee its accounting and fiscal validity.
Conversely, a supplier invoice is a commercial document transmitted by a service provider or supplier to its customer, certifying the delivery of goods or the completion of a service. It specifies mandatory information such as:
- The invoice number;
- The date of issue;
- The description of products or services provided;
- The amount including VAT;
- VAT;
- Payment conditions;
- Supplier contact details.
What are the challenges and issues of supplier invoice management?
The management of supplier invoices raises many challenges for companies, particularly in a context of cost inflation and the search for operational performance.
Complexity of fiscal and accounting regulations
Companies must comply with strict fiscal and accounting regulations. Each invoice must contain mandatory information or risk rejection during an audit. Failing to respect these rules can lead to financial sanctions and disputes with the administration.
Risks related to payment delays and errors
Payment delays constitute a major risk to the company's cash flow and can result in late payment penalties. Data entry, matching or invoice validation errors are frequent in manual processes and can generate additional costs or even tensions with suppliers.
Impact on supplier relationships
The quality of invoice management directly influences relationships with suppliers. Repeated delays or errors can deteriorate trust, extend delivery times or even lead to the breakdown of collaboration. Conversely, fluid and transparent invoice management reinforces the company's credibility and favours lasting partnerships.
What is the regulatory framework for supplier invoice management?
Supplier invoice management is governed by a set of standards and directives that aim to guarantee transparency, traceability and compliance of transactions.
Directive 2014/55/EU on electronic invoicing
This directive has imposed, since April 2019, the digitalisation of transactions in public markets within the European Union. It aims to harmonise electronic invoice formats and simplify their automated processing, thereby reducing deadlines and administrative costs for companies.
ViDA Project (VAT in the Digital Age)
The ViDA project, initiated by the European Commission, aims to modernise VAT rules in the digital age. It notably provides for the obligation of electronic invoicing for B2B transactions, automation of VAT declaration and reinforcement of controls.
Specific obligations
Beyond digitalisation, businesses must respect precise obligations:
- Mandatory information on each invoice;
- Respect payment deadlines (generally 30 days, except specific agreement);
- Secure archiving of invoices for a legal duration (generally 10 years);
- Respect security and confidentiality rules when processing data.
Best practices for optimising supplier invoice management
Optimising supplier invoice management relies on adopting best practices that aim to make the process more reliable, reduce costs and improve overall performance.
Standardisation of the supplier invoice management process
Standardisation consists of defining clear and reproducible steps for each invoice:
- Receipt of the invoice (paper or electronic);
- Verification of compliance and mandatory information;
- Validation by relevant departments (procurement, accounting, management);
- Entry and recording in the accounting system;
- Payment in accordance with contractual deadlines;
- Secure archiving of the invoice.
This approach helps limit the risk of errors and guarantee the traceability of each operation.
Automation and digitalisation
The automation of repetitive tasks (data entry, matching, validation) through management software or electronic invoicing solutions allows to:
- Reduce processing times;
- Decrease the risk of human errors;
- Improve visibility on invoices in progress and financial commitments;
- Simplify access and archiving of documents.
The digitalisation of transactions is an essential lever to gain efficiency and meet regulatory obligations, as highlighted by Antoine COMPIN, Managing Director of Manutan France: "Digitalisation allows us to improve and automate processes, which saves time and limits the risk of error. It also accelerates information transfers with a supplier or a customer, for example, for an order, an invoice, or a claim."
Training and awareness of teams
The success of an optimisation project depends on supporting teams. It is essential to:
- Train collaborators on new tools and processes;
- Raise awareness of compliance and security issues;
- Implement regular controls to detect and quickly correct anomalies.
Which solutions to choose for optimising supplier invoice management?
The digitalisation of supplier invoice management relies on various tools, depending on the company's size and digital maturity level. The main available solutions are:
- OCR (Optical Character Recognition): to automate the reading of paper or PDF invoices;
- EDI (Electronic Data Interchange): for structured and secure exchange;
- SaaS platforms for invoice management.
The integration of invoice management solutions with ERP (Enterprise Resource Planning) systems is essential to guarantee data consistency and reliability. It enables:
- Automated matching between purchase orders, receipts and invoices;
- Global visibility on commitments and cash flow;
- A reduction in manual tasks and error risks.
Which steps to follow for optimising supplier invoice management?
To successfully optimise supplier invoice management, it is advisable to follow an approach in several complementary steps:
- Analyse the existing situation: map invoice flows, identify friction points;
- Define objectives: reduce payment deadlines, improve added value;
- Choose the right tools: according to volume, budget and internal constraints;
- Implement selected solutions: configuration, testing, training;
- Measure results: monitor KPIs (processing cost, average time, error rate);
- Continuous improvement: integrate user feedback, evolve the process.
Case study: digitalisation of supplier invoice management in a company
A medium-sized company, faced with a growing volume of supplier invoices (approximately 10,000 per year), had until then managed the entire invoice processing manually: receipt of paper invoices or PDFs by email, manual data entry in the accounting software, physical validation by different departments, then paper archiving. This operation generated:
- High costs: €14 to €20 (around £12 to £17) per invoice;
- Payment delays and tensions with suppliers;
- Risks of errors and document loss;
- Lack of visibility on cash flow and financial commitments.
The company deployed a digitalisation and automation solution for supplier invoice processing, integrated with its ERP. The key steps were:
- Centralised receipt on a single platform, all formats combined (paper, PDF, EDI);
- Automated extraction of key data via OCR (optical character recognition): invoice number, amount, VAT, supplier...;
- Digital validation with automated workflow and alerts in case of delay or anomaly;
- Intelligent matching with purchase and delivery orders, blocking discrepancies;
- Secure electronic archiving accessible at any time;
- Real-time monitoring via dashboards (deadlines, errors, pending invoices...).
The results obtained are:
- Costs divided by 3 to 4: from €14-20 (£12-17) to €2-5 (£1.7-4.3) per invoice;
- Processing twice as fast: validation in less than 24 hours;
- Fewer errors: elimination of duplicates, automated controls;
- Optimised cash flow: timely payments, better visibility;
- Strengthened supplier relationships: fewer disputes, more trust;
- Time savings for teams, reoriented towards value-added tasks.
Automated invoice processing has enabled cost savings, process acceleration, data reliability improvement and enhanced supplier relationships.
Optimising supplier invoice management is a major strategic lever for all companies wishing to control their costs, gain efficiency and strengthen the quality of their supplier relationships. Digitalisation, automation and team training are all key success factors for achieving this transformation.
