Archive - October, 2011

International e-Invoicing and local VAT rules

Electronic invoicing is becoming more and more common in businesses across the world. Despite the enthusiastic uptake however, several so-called electronic data interchange (EDI) standards exist which, when combined with local e-invoicing regulations can cause major problems for suppliers.

One of the largest problems for international e-invoicing is the localised implementation of Value Added Tax (VAT) and how it is implemented by a foreign government. In most countries, businesses wishing to import goods are obliged to calculate and pay the correct amount of value added tax. Failure to calculate the correct VAT fee can lead to fines for non-compliance and delays in the shipment and delivery of goods. Presenting invoices in the wrong format can also prevent businesses from reclaiming available VAT rebates, adding further cost to a transaction.

Particularly problematic are countries within the European Union who although encouraged to implement e-invoicing under EU regulations, are also able to implement such directives in almost any way they see fit. Standardisation is therefore impossible as the determination of invoice integrity works on a country-by-country basis.

To deal with such a lack of standards, businesses can choose to adapt their existing in-house systems in the hope that they can cope with the multitude of different e-invoice expectations, or outsource the processing to a third party. Because of the diverse rules across Europe (and South America to some extent too), some companies are choosing to use the services of single country ERP cloud providers.

Such an approach however is far less cost-effective for the supplier who is ideally seeking a single e-invoicing provider who can provide the required interfaces to deal with governments and businesses anywhere in the world. Using a single, integrated solution such as Smart Admin from Celtrino will help to cut the complexity and cost burden placed upon a supplier and allow them to focus on the more important aspects of the transaction, such as manufacture and delivery. Using an outsourced solution, a business should also be able to ensure VAT is paid automatically at the correct point of the transaction and the rebate collected at the appropriate time too.


Posted on October 31, 2011 in European Commission, European Union, Supply Chain Management by
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Scottish Government Enters e-Procurement for the First Time

As with many other European governments, the Scottish Government has decided to replace its current electronic procurement platform with a hosted service. The Government have signed a four year contract worth £18.5 million to provide online purchasing services named eProcurement Scotland Service.Scottish_Government_logo

Alex Neil, the Scottish Government’s cabinet secretary for infrastructure and capital investment said, “The award of this contract builds upon Scotland’s successes in the deployment and management of public sector e-procurement technologies.”

The eProcurement Scotland platform will be run across datacentres spread across a number of different locations with centralised management from the Government’s datacentre in Edinburgh. Support services for users will come from an external company based in Aberdeen whilst integration and transition services will be provided from a Glasgow office.

The contract is expected to provide both cost savings and environmental benefits. The eProcurement Scotland project will see 73 servers reduced to just 19 through the use of an outsourced virtual hosting environment. This reduction of physical hardware will result in lowered management costs, 75% less electrical power draw and a smaller carbon footprint. The Scottish Government calculate the carbon savings of the move will be equivalent to taking 200 cars off the road each year. The system will be better for users as well as the environment.

eProcurement Scotland The new eProcurement Scotland platform replaces the existing system which was set up in 2002 and currently processes orders in excess of £8 billion per year. There are more than 50,000 registered public sector users, capturing nearly 33% of the Scottish public sector spend.

The eProcurement Scotland platform is intended to be a flagship development of the Holyrood Administration. In Alex Neill’s words:”It [eProcurement Scotland] also showcases Scotland’s supplier capability to host and manage what is regarded as one of the leading government ecommerce services.”


Posted on October 28, 2011 in eProcurement, Order Management Processing, Public Sector by
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Supply chain automation made easy

“(…) time taken to switch all your paper-based transactions to the platform is minimal. Supplier ‘on-boarding’, as it’s termed, just isn’t an issue.” – have a read of my interview with Malcolm Wheatley in the May edition of The Manufacturer.


Posted on October 27, 2011 in Celtrino Platform, Supply Chain Automation, Supply Chain Document Automation, Supply Chain Integration, Supply Chain Performance by
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Supply Chain Integration Introduction Part 5 – The Future

For businesses looking to implement their first supply chain integration systems, or those looking to improve that which they already have, the future of the methodology will remain of interest. The continued explosion of hosted systems (also known as Software as a Service – SaaS), has already begun to radically alter the supply chain integration landscape.

As discussed elsewhere throughout this short series of articles, supply chain integration is currently a job requiring extensive (expensive) expertise due to the complexities inherent in joining multiple computer systems. As with most technological advances, implementation of integrations should get inherently easier as on-site complexity is reduced. Suppliers will be faced with the choice of rolling out the exact same ERP system in each of their own businesses, or to outsource the EDI functions required to communicate between disparate systems to a third-party.The Future written on the white board

As cloud-based software and services continue to mature, the use of on-site systems becomes more expensive and effectively redundant. By outsourcing functions to the cloud such as invoicing and billing, businesses immediately benefit from a reduction in complexity and duplicated effort. An ideal Business Process Outsourcing (BPO) platform will take input from any ERP or accounting system, as Celtrino’s Smart Admin product does, and seamlessly convert and transfer the data to a receiving system. The onus for translation and EDI connectivity becomes the responsibility of the hosted service provider.

In such a scenario, the cloud service provider configures and maintains the EDI connectors for the systems of all of their service users, for the same subscription fee. The clients are then able to make savings on the costs of hiring EDI consultants every time a reconfiguration of the data interchange layout is required.

Business Process Outsourcing as part of a Supply Chain Integration is a hot topic and looks set to remain so for some time. As demand for BPO increases, service providers will be forced to further tune and improve their offerings. All this is great news for the customer and their customers in turn.

If you would like to know more about how Celtrino’s Smart Admin platform can be used to assist your business in Supply Chain Integration, please do not hesitate to contact us.

 
Supply Chain Integration Part 1

Supply Chain Integration Part 2

Supply Chain Integration Part 3

Supply Chain Integration Part 4

 


Posted on October 26, 2011 in B2B Platform in the Cloud, Business Process Outsourcing, Integrated Supply Chain Management Platform, Supply Chain Integration, Supply Chain Management, Supply Chain Performance by
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Sales Order Processing Automation improves Order Management & Profits

Read up on how we can speed up the sales order process and reduce manual errors.


Posted on October 25, 2011 in Order Management Processing, Sales Order Processing, Smart Admin by
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Upstream and Downstream – Navigating the Supply Chain

Upstream and Downstream in Kanuti River, Alaska.In terms of metaphors, the river is a perfect picture of a general supply chain. At the river’s source lies the producer of the raw materials. He loads his wares onto a boat and sails downstream until he reaches his buyer whereupon he offloads his goods, takes his payment and sails back upstream to his home. The buyer then assembles the raw materials into a product and ships them further downstream to his buyer. The goods travel downstream and a payment is returned upstream. This process continues down the length of the river until the finished goods are sold to the consumer.

In terms of the river, two things always happen. Goods travel downstream and money travels upstream. And so it is with the supply chain.

In the event that the supplier at the start of the river delivers directly to the end customer, the supply chain is a simple two stage process. Once there are multiple buyers and suppliers involved however, the supply chain becomes more complicated.

Also worthy of consideration is the fact that the cost of the intermediate goods rises with each stop. Value is added to the product at each intermediate stage and prices must also rise to cover mounting costs.

At this level, everything is still quite simple without any obvious room for efficiency savings. However, add an accounts department at each stop and the process immediately becomes more complex. The buyer has to send a purchase order to the supplier upstream before the goods can be sent downstream adding another journey to the supply chain. An invoice can be sent along with the goods, but payment and remittance advice will not be available immediately upon presentation, so that means another trip upstream to clear the account. Suddenly the supply chain is slowed considerably. Instead of a simple there-and-back trip, the are now three or four journeys required for one hop in the overall supply chain.

At this point, only the introduction of a system which links both up and downstream but which exists outside both can make the efficiency savings required to maximise profit and ensure value added is retained as profit. Adding an electronic supply chain integration platform such as Celtrino’s Smart Admin system obviates all the journeys back and forth with bits of paper between suppliers and buyers – almost like sending a carrier pigeon between both parties and saving the ship’s captain a number of trips.

Less trips, means lower costs. Tying seller and buyer together with an integrated supply chain management helps increase efficiency and everyone shares in the increased profits.


Posted on October 24, 2011 in B2B Platform in the Cloud, Electronic Remittance Advice, Integrated Supply Chain Management Platform, Supply Chain Integration, Supply Chain Management, Supply Chain Performance, Supply Chain Upstream and Downstream by
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Supply Chain Integration Part 4 – Best Practice

Best Practice written on a white boardThe recognition that supply chain integration with your suppliers and partners is of paramount importance is the first step in a sometimes challenging and complex process. Each member of a supply chain has their own way of doing things, using a variety of different systems which at first glance are probably not fully interoperable.

Despite being a “standard” Electronic Data Interchange, or EDI as it is known for short, there are many minute variations and tweaks required in order for one computer system to “talk” to another. As a result, reconfiguration will have to take place at each supplier to allow for smooth communications. EDI setup and maintenance is an expert job and being time intensive, is also costly. As a result the use of an outsourced service which does the required EDI translations automatically is preferable.

The use of an externally hosted Electronic Invoice Presentment and Payment (EIPP) system allows every member of the supply chain to integrate their payment systems for maximum compatibility, whilst retaining complete autonomy over their own data and in house processes. During the supply chain integration process, companies can choose to enable as much or as little interchange as they desire. Obviously the more interchange permitted, the greater the on-going cost savings through a reduction in labour costs that would be accrued through manual processing of the same actions.

Clearly the complexities of such an integration is outside the experience (or interest) of most businesses and so they will need to secure the services of a specialist consultancy. Here are three suggestions to help when choosing:

  1. A proven track record in successful completion of supply chain integration. Any company you consider should have verifiable testimonials from previous customers and reference sites which can be visited for first-hand verification.
  2. Experience in trading community onboarding. Integration projects deal not only with system interoperability, but also the political issues raised by bringing together businesses with differing values and ethics.
  3. The ability to make integration as simple as possible with the minimum of disruption for any member of the supply chain.

In the light of these suggestions, expertise in supply chain integration is just one facet of the decision process. The technology and methodology used is just as important with on and off site implementations of supply chain integration. Clearly Business Process Outsourcing (BPO) options which see the EDI services hosted externally are preferable in terms of scalability, speed of deployment and minimisation of disruption – all data interchange is performed externally with minimal local reconfiguration required.

 

Supply Chain Integration Part 1

Supply Chain Integration Part 2

Supply Chain Integration Part 3

Supply Chain Integration Part 5


Posted on October 21, 2011 in BPO, Business Process Outsourcing, EDI, Electronic Invoice Presentment & Payment, Outsourced EDI, Supply Chain Integration, Supply Chain Performance by
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Electronic despatch advice: real time tracking of delivery information

Read how automation of delivery information (in form of electronic despatch advices or advance shipping notices) can optimise your supply chain performance.


Posted on October 20, 2011 in Advanced Shipping Notice, Electronic Despatch Advice, Smart Admin, Supply Chain Integration, Supply Chain Performance by
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UK Government cloud computing implementation sternly rebuked by Benioff

hilst in London recently speaking at a developer conference, Salesforce CEO Marc Benioff took the opportunity to deliver a stinging criticism of the UK government’s cloud computing implementation record to date. Under the title of the “G-Cloud”, the British government has been attempting to reduce the number of datacentres currently used across local and national agencies.

Benioff was clear that he believes the UK is behind the US in terms of government cloud adoption and as a result was missing out on the potential for significant “cost reduction”. Worse still, in Benioff’s opinion, UK government datacentres are running well below maximum efficiency. “That’s not ok,” he said, “It’s costing them a fortune.”

However Benioff’s comments are not merely the rantings of a service provider with a vested interest. Statistics available on the European Commission’s website further reinforce the view that the UK government’s tardiness in joined up IT systems is a costly mistake, also resulting in a loss of competitive advantage over other EU neighbour states.G-Cloud, Government Cloud, Government Cloud Computing

The apparent lack of government desire to implement electronic supply chains and the like also has a knock on effect for national businesses. The Digital Agenda for Europe collates data regarding the use of EDI systems for inter-business trading, the results of which make quite shocking reading. It is only in the previous calendar year that the UK has finally begun to implement Electronic Supply Chain Management in anger, finally moving from the bottom of the table where the country had languished since records began two years earlier. Shockingly, the UK is still far, far behind other countries including Croatia, Latvia, Lithuania and Cyprus.

Unfortunately these statistics are replicated across a number of other data sets relating to electronic invoicing and the automatic exchange of business documents. As before the UK lags behind almost all of their European neighbours in these key indicators, suggesting that UK businesses are missing out on the efficiencies and costs savings available.

Benioff and the Digital Agenda for Europe statistics are unable to explain why uptake of these cost-saving systems are so low in the UK and why businesses keep choosing to miss the opportunity afforded them. Whether it is a misconception as to the complexity of implementation of EDI, a poor understanding of the benefits or just a general ennui, the fact remains that British businesses are losing out to themselves and to their neighbours.

Benioff’s suggested solution, to move systems into the cloud, makes perfect sense. Businesses choosing to implement a hosted Electronic Invoicing Presentment and Payment (EIPP) system, an electronic supply chain management strategy or automated document exchange mechanism such as Celtrino’s Smart Admin will see immediate benefits. It is through such adoptions that UK businesses have the opportunity to guide the government to the cloud and not vice versa.


Posted on October 19, 2011 in B2G e-invoicing, Cloud Computing, EDI, EIPP, Electronic Invoice Presentment & Payment, European Commission, G-Cloud, Government Cloud by
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Moving financial transactions to the cloud can win you big contracts

Read how we helped Kooky Dough realise the supply chain efficiencies that helped them move to the next level as a business.


Posted on October 18, 2011 in B2B Platform in the Cloud, Celtrino Platform, e-Invoicing, eBilling, EDI, Outsourced EDI, Supply Chain Document Automation by
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