There are many businesses that engage third party providers to deliver part of an overall service to customers. Acting as a reseller can deliver significant benefit to customers but it does give some challenges when it comes to cost allocation processes. Some examples of this type of activity are:
- Telecoms service resellers receive invoices from telecoms companies that need to allocate costs to their customers
- Digital Agencies receive invoices from hosting companies for web traffic that need to be charged onto their customers
- Fulfilment Service providers receive invoices from courier delivery organisations that need to be divided across their customers
Processing consolidated bills from third party providers can be a time consuming activity. As a reseller, being able to identify which elements of an invoice can be allocated as costs to an individual customer is a core skill. It typically means “Line by Line” processing of the consolidated invoice during the allocation of the charges into a finance application which is then used to apply the appropriate actual customer charges to bill the client. The extracted “Line by Line” details often need to be included as information to the client as evidence of the usage costs incurred.
Although there are many solutions available for simple invoice processing with or without PO matching, the complexities of consolidate billing make a real difference. Many finance departments have staff manually working through the consolidated third party invoices “Line by Line” in order to ensure effective billing to the end clients of the reseller charges and to identify any discrepancies which could lead to “un-allocated” charges.
RPA software robots like Invoice detail lines
Robotic Process Automation (RPA) uses software robots to perform repetitive work that follows structured processes. The scenario of consolidated bills being processed for cost allocation is a good fit for the use of software robots. The process by definition is repetitive, well defined, relative high volume and requires a high degree of accuracy.
By deploying software robots to undertake the activity, human staff have time freed up to investigate exceptions or unusual changes in the charges. This allows people to add more value by looking for fraud, adding customer service and analysing trends rather than doing the mundane cost allocation activity.
With software robots being able to work 24 x 7 and at speeds of that are typically 10 times faster than people, the delay between the arrival of a consolidated invoice and the preparation of cost allocations can be reduce which could lead to earlier billing of clients with the corresponding benefit to a business’ cash flow.
As software robots need to be configured to understand consolidated invoices and how to allocate costs, it is inevitable that changes by a provider in the structure of an invoice can required amendments to the robot configuration. However, as most companies only change their invoice structures when there is a change in the nature of the business or when they alter their internal finance application, the changes are not frequent and the benefits from the robot processing during the period of stability is usually sufficient to provide a healthy ROI.
Please contact us to discuss how RPA software robots could help with your allocation of invoice details - 0845 643 4410