The Oil and Gas e-Transactions LinkedIn group recently published a survey about exchanging business documents electronically, and it’s not a fair fight. Most companies are sending or receiving invoices via email, fax, snail mail or a supplier web portal. The average company processed more than 5,000 invoices per year.

So what’s the damage? Why is this labeled “inefficient” for both suppliers and operators? It’s because it wastes your company’s money.

• Using a modest 10 minutes to manually reconcile an invoice and type it into your back office, 5,000 invoices costs about $50,000 at a conservative $10 an hour pay rate.
• Five to 10% of suppliers have at least one minor error in their invoices that costs you money. Most companies pay these errors as a burden of doing business even though an error of half a penny per gallon can cost the average company over $500,000 annually.  (Note: The average supplier has 10 to 99 customers with many different contract prices, invoices, tax profiles, and complexities.)

So, 86% of suppliers invoice their customers expecting manual processes, and 75% of customers are performing manual work while only 7 to 11% of companies like Walmart, Circle K and Costco are benefiting from significant cost savings by using a market place solution to remove inefficiencies.

What’s your view on doing business the old fashioned way via fax, email (Yes, email is old fashioned. Just ask anyone under 20!), and snail mail? How is your business going to compete when you spend more on manual processes then the market leaders do on software? I think it’s like bringing a knife to a gun fight, and only time will determine who is the quick and who is the dead.