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Purchase-to-Pay

What is Purchase to Pay?

It’s not just about saving money, it’s about getting value for the money that’s being spent too. P2P is a management system in which all of the processes involved in buying something are managed by one central resource, rather than each step having its own standalone system.

In most organisations, Clerical staff have to take information from one system (e.g. Purchase Ledger) and work to relate it to data in another system (e.g. Accounts Payable). In passing data from one process to another, losses and errors occur. If a goods advice note doesn’t match your Order records, you don’t know if that order has been fulfilled.

When an invoice arrives that doesn’t match your records, it has to be manually entered and processed by AP staff. P2P systems try to match records for you.
When you raise a Purchase Order, a P2P system will hold the essential information in readiness for the expected arrival of the product, and eventual arrival of an invoice.
When the invoice arrives, it is automatically checked to see if it is what the PO anticipated. If it is: the invoice is cleared for payment automatically.
This can make a significant reduction to the amount of manual work being done in matching PO to Delivery to Invoice. As long as the details are correct: the transaction is automatic. Only cases where the details don’t match require human intervention.
In a good P2P environment, the details of the PO you send are ‘flipped’ (copied by the Supplier) to describe the delivery, and invoice, so that your inbound documents match your outbound ones.

A busy AP Clerk can process 100 invoices per day, or 25,000 p.a. If that becomes 100 exceptions (mismatches) per day, while 300 others pass automatically, the same AP Clerk can pass four times as many invoices in the same day. Simplify the handling of all invoices and create a process that is touchless and eliminates errors.

Purchase to Pay combines all of the processes in buying goods and services into one managed flow. Without it, Finance, Procurement, Accounts etc. pass the parcel with your purchase processes. Managing them all together means that items don’t stall or get lost between stages. Duplicate payments are prevented. Complex contracts need P2P to keep them progressing. Multi-stakeholder projects need more sophisticated management than basic Accounting can provide.

Good P2P systems integrate with ERP suites such as Oracle. By doing more than ERP modules, quicker and better, at a fraction of the cost, P2P suites act as aftermarket add-ons that leave the ERP to manage its high-level reporting while providing a plug-in point for Auditing.

The end result is streamlined cashflow. Suppliers can offer lower pricing in return for quicker payment. P2P automates checking that was being performed repetitively, thereby increasing the amount of purchases that don’t need manual intervention. Organisations that adopt P2P management systems typically find ROI times of 6-9 months.

FEATURES

Basware P2P

AP AUTOMATION

Feature-rich and configurable Accounts Payable solution to automate the most demanding global processes.
> 100% paperless from day one
> Advanced invoice approval automation
> Accurate forecasting to manage working capital and cash flow
> Automating matching of invoices, purchase orders and payment plans
> Review and approve invoices on your phone and tablet

E PROCUREMENT

Increase spend under management, realize significant cost savings, and increase supplier value.
> Consumer-style shopping experience with one-click catalog purchasing
> Flexible free-text forms to manage services procurement and capture input
> Configurable workflows for increased compliance and control
> Anytime, anywhere access from mobile and tablet devices
> Actionable spend and procurement analytics with data visualization

STRATEGIC SOURCING

Drive your business forward by finding the best partners for both direct and indirect procurement.
> Reduce time needed to identify the right suppliers from weeks to days
> Savings and deeper supply value with an agile e-sourcing and e-auctions solution
> Streamlined supplier evaluation process with a collaborative sourcing solution