Buying online has swiftly become the norm in our everyday lives and although many B2B organisations usually deter their staff from buying online, the risks of doing so are becoming harder to justify. Whether its lack of spending visibility, approvals or simply not having that customer/supplier relationship many businesses have become accustomed to, accounting teams don’t enjoy having to navigate the disjointed steps between online buying and their AP process. For accountants, the two simply work well together and it’s not worth the product range and pricing deals you can find online compared to current suppliers.
However, this seems to be changing. In a recent report by Forrester, they predicted that by 2023 online buying within B2B organisations will account for 17% of all B2B sales. It may not seem like a revolution in how businesses are buying, but in contrast to how non-existent online buying is in most businesses, it’s a pretty significant jump. This trend can be accounted for the growth in of a fast-growing accounting process…Buy to Pay.
Sometimes confused with Purchase to Pay, Buy to Pay also covers activities of requesting, purchasing, receiving, paying for and accounting for goods and services. The major difference is that a true Buy to Pay solution should allow you to make your purchases through online retailers without stepping out of your ordering, approval and invoicing processing.
Let me explain by addressing some of the key concerns that accountants have with their organisations buying online.
Disconnect between online purchase and AP process
The beauty of a true Buy to Pay solution is that everything captured and processed in one place – I’m talking all the way through product codes, PO numbers and header/line-level data! It’s this act of capturing the data that then allows a solution like ours to present spend data into a real-time view of the whole purchasing process. No longer will you have to keep tabs on who has a corporate credit card, what they can spend it on and how much, well after the bill has arrived on your desk.
No supplier/customer relationship
For many B2B organisations, a big advantage of dealing directly with a supplier is the opportunity to build a relationship with them. This relationship can be beneficial for both parties, but for you as a buyer it can be a route to negotiating better service, prices and delivery time. But even with a good supplier relationship, these perks are not always a given and you may have to source multiple suppliers for different items. Buying online can offer a wider range of products and better savings, without having to spend time shopping around.
Multiple invoices from various suppliers for one order
One advantage of some online marketplaces is that they can enable their customers to purchase multiple supplier items in one transaction. It cuts out hours of shopping around, but I know the thought of how an accountant can match multiple supplier invoices against one purchase order is a daunting one. But with every step of the buying process happening in your Buy to Pay system, purchase orders are automatically matched with incoming invoices, even if there are multiple supplier invoices to one PO coming at different times.
No visibility over maverick spending or approvals
One of the biggest concerns with online buying is accountability. For example, if corporate credits are given to heads of departments, how can you track who has spent what in their teams? Furthermore, how would you know who it was approved by; if at all. A Buy to Pay process allows accountability for every stage of the purchasing process, with audit trails and approval workflows to make sure maverick spending is curbed and that no spending can take place outside of the approved process.
After understanding how Buy to Pay addresses the major concerns many accountants have with online buying, there really is no excuse for businesses to continue avoiding it. By excluding online buying from your organisation’s buying process, you’re missing out on the wide range of product choice and price savings that you benefit from when making personal purchases online. A Buy to Pay solution encompasses all your accounts payable requirements, whilst seamlessly integrating with your Xero accounting software to cover every step of an online purchase.
So, the next time you find yourself looking to make a purchase online, ask yourself: what other excuse is there to not be buying online in my organisation?