John Stokdyk, editor of Accounting Web rang me couple of days ago to enquire about ebdex. As a result, he has published an article about the EIPP market as well as ebdex. Extract of the article (the interesting bits about us) is captured below for your convenience:
Visit the purchase ledger department of almost any organisation and you are likely to witness working practices that still reflect their Victorian origins. Manoj Ranaweera is CEO of a web-based EIPP start-up called ebdex, which is due to go live in the next couple of weeks.
He first got interested in the subject as a project manager for a large engineering consultancy and dispaired at the wasted effort. "We recorded our work on Excel time and expenses sheets, which we printed out and sent to the accounts department. They retyped the data into Oracle and when an invoice needed to be generated, they copied the information from Oracle into Excel and posted or faxed the invoice to the client. When it went to the recipient organisation, it needed to be retyped, so the effort that went into it was triplicated."
The advantages and claimed savings are compelling, but as Paul Kelly noted, EIPP remains a minority interest, mainly for large multinational organisations with the buying power and technology infrastructure to maintain a proprietary in-house system. Having studied the market with some care in recent years, Ranaweera explains why Paul Kelly and other small companies have been frustrated in their attempts to adopt electronic invoicing in the past.
"There are a lot of solutions out there, but they’re pretty much geared for larger organisations. The biggest problem for small companies is that while they had these systems imposed on them by big suppliers such as Ford or supermarket chains, they couldn’t comply because they didn’t have the infrastructure or know-how. So the large companies didn’t get the benefits they expected. Because they were trading with their tier 1 and tier 2 suppliers, they were pretty close knit groups which excluded smaller players in the market."
In the early days, EDI usually meant leasing dedicated data lines and building virtual private networks. The technology was not that well developed, and expensive, Ranaweera explains. By the late 1990s the internet was making its presence felt. The first web-based e-invoicing site, ob10.com, was followed a few years later by Accountis. Like ebdex, these systems are designed as online invoice exchanges and include programming interfaces and XML-based translators to extract and feed invoice data between the users’ accounting systems.
In spite of the obvious benefits, the take-up of EIPP is still slow. But signs are emerging that electronic techniques are beginning to find their way into the finance departments of smaller companies. Accountis, for example, noted that SMEs struggle to cope with the transition and offers a managed paper/electronic service, where its staff will take paper invoices from client companies and input them into its system.