Without a doubt, Bruno is the master of e-invoicing in Europe if not the world. His e-invoicing Quarterly is a much anticipated update of the e-invoicing market. Whilst I have hoped to do something similar for the UK market, I must admit, I am less organised than Bruno. However, I plan to put my e-mail marketing solution from iContact into full swing this year. If you are interested in e-invoicing and have not subscribed to Bruno’s e-invoicing Quarterly, I suggest you do that right away. Here is a review of what Bruno has written.
1. European Market Outlook 2008
The e-invoicing market continues to remain fragmented and small but with potential to be a significant market. Unfortunately, not much has changed since the early 2000’s except for the increasing number of vendors entering the market place, as reported by Bruno. This is obviously a positive side of a maturing market and has led to minor improvements in the overall market share. However, the optimistic predictions of analysts continued to be missed, year after year. We are still addressing the fundamental problem of replacing paper based solutions with electronic systems. We also seems to have forgotten that our key competitor is none other than paper.
Whilst much has been spoken of supply chain finance and the second p (payment) of EIPP, none of these solutions are going to achieve traction until the fundamental problems are sorted out including the significant barriers faced in implementations. This is not to say that the best-in-class companies, as regularly reported by Aberdeen Group, are not enjoying the benefits of e-invoicing. All I am highlighting is that current deployments are a drop in the ocean, when compared to the potential market size, and significant drive from vendors, consultants and governments are needed if this market segment is to be taken seriously. Lack of profits within the service provider organisations continues to dampen the spirit of the enthusiasm.
Niche players such as OB10 has worked tirelessly to promote e-invoicing globally whilst companies such as Ariba has entered the market as part of its product diversification strategy. The scanning and OCR providers, EDI houses and accounts payable specialists all admit that EIPP is the way forward. Many of these companies I have spoken to remain convinced that EIPP is yet to arrive. I do not think they are been ignorant. If a company does not change to satisfy changing market conditions, the survival of the company will be short lived. Their stand is simply based on customer requirements, i.e. none of their customers are asking for EIPP or e-invoicing. So something is missing from the market place. I put this simply down to lack of awareness which can only be addressed by EDUCATION EDUCATION EDUCATION.
Lately, many financial organisations have taken a vested interest in purchase-to-payment or e-invoicing document exchange. Most of the global leading banks are either offering services through partners or currently in discussion with partners to offer these services. At the same time, there are commercial lending organisations such as invoice discounters and factors taking an interest in the segment. This has also created an environment where traditional vendors for the financial sector is taking a closer look at EIPP, e.g. FundTech. Forrester has claimed this is the year for consolidation. No doubt there will be one or two major transactions, but it is more likely 2009 will be the year for consolidation.
What all of above means is that the e-invoicing or EIPP market should start to make progress this year. More work is needed to encourage service providers to collaborate with each other. I would like to see much more activity at Hub Alliance and other initiatives this year. The problem with Hub Alliance is that there is no budget to drive the “alliance” forward. In addition, the members’ aspirations are limited by their own personal needs, rather than offering a “alliance” for everyone interested in e-invoicing. Whilst I remain pessimistic about the market segment, I am hoping that I will be proven wrong this year.
2. European ExPP Summit
Many thanks to Bruno for organising an exceptional event. Also thanks for the X’mas present, which shows what a gentleman Bruno is! I look forward to participating in this years event. However, my personal feelings for the last year’s event was that it missed a trick. As I continue to say EDUCATION EDUCATION EDUCATION, I felt that the last year’s event was very much organised for the vendor community and not for the potential users. I cannot remember meeting a single person who was looking to purchase a solution. This is also down to the marketing of the event. As an admirer of Bruno, My blog is freely available for any promotion activities of ExPP. This year I can also offer edocr free of charge. A real possibility exists where all ExPP documentation could be hosted by edocr including special interest groups for discussion of various topics prior to and after the event, so that this year’s event become a collaborative event instead of a traditional event. Anyone else got any more bright ideas?
3. Accelya
Thanks for the story Bruno. I must admit, ADP Clearing was not a company I tracked before. As I understood from the story, Chequers Capital has acquired ADP Clearing and has renamed the company as Accelya. Accelya specialises in invoices, travel reservations, airline tickets, payment instructions and credit card collections, and consider themselves as a leading Business Process Outsourcing (BPO) service. This classification put them immediately in competition with large BPO providers and less in competition with niche players such as OB10. With annual revenues of $70 million and over 8 million e-invoicing transactions, further review is necessary to understand their business model and product offering. Level of e-invoicing transactions seems to be low compared to the revenues, suggesting deployment of a less optimum model than the niche players. The web site has a modern feel but significantly lack in information to undertake a quick review. Looks like they have not found out about edocr yet.
4. Partnership between Basware and Crossgate
Ah! This is a story I knew about and planned to cover, but never got the chance. Crossgate is a user of edocr, but Basware has not yet taken the advantage of edocr. Would you believe, I am yet to do an e-mail marketing campaign on edocr to e-invoicing (EIPP) service providers or to anyone else for that matter. All documents related to e-invoicing on edocr can be found from here. I am not going to cover the story now, other
than to say that the inter-operator connection allows over 74,000 companies to be reached.
What is uncertain from this press release is that whether this number takes into consideration of companies connected to Burns e-Commerce, Causeway’s Tradex, Asite, Certipost and Laison, who are all members of the hub alliance. Whilst I was providing advisory services to Causeway Technologies in 2007, one of the channel partners I introduced was looking to achieve the same result. Under current arrangements, this company do not qualify to be a Hub Alliance member, as they do not operate a hub.
But if discussions are successful and if they became a partner of Causeway’s Tradex, then they could indirectly exchange purchase-to-payment documents electronically with companies that are connected with any of the Hub Alliance members.
The importance of this realisation is that Hub Alliance should be at the centre of e-invoicing debate and not at the side. You do not need to be a member of the alliance, but simply need to be a partner of one of the members to benefit from the upside. Whilst this sounds all too easy, significant efforts are required to make this successful. I strongly believe its time that Hub Alliance members appoint an independent person to promote and administer the interests of all those concerned. Let’s hope 2008 is the year this happens.
5. Swisscom IT Services with international e-invoicing campaign
Once again, not a story I tracked. Interesting to note is that my friends at TrustWeaver is working with Swisscom to make this transition a success. Trustweaver has significant expertise in the legal requirements of different countries so that their expertise can be leveraged in order to ensure compliance during the launch of services a
cross 20 European companies in the first stage followed by another 20 countries in Europe and the world. Certainly, an ambitious project, and the market needs more of these initiatives to win market share from paper.