E-Invoicing for international clients – Unlocking global opportunities
When you think you’ve got your invoicing process under control – an international client enters the picture, bringing with them a slew of regulatory and legislative requirements. But the pursuit of international clients isn’t just a business strategy – it’s a gateway to growth and expansion. So why does it often lead to frustration in sales and AR teams? The answer is simple. Manual invoicing processes are not designed for scalability or longevity, making them ill-suited for the demands of international business.
Cue e-invoicing.
From a South African regulatory perspective, for many, shifting to an e-invoicing solution may seem like a distant concern. However, the conversation takes on a new dimension when we view it not only as a legislative requirement but as a catalyst for business growth. This is especially true when we consider the transformative impact that e-invoicing solutions can have on global trade opportunities and acquiring international clients (without incapacitating your AR team).
Understanding the Impact of E-Invoicing for International Clients
International invoicing processes can pose challenges such as:
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- Keeping up with the changing tax landscape:
International invoicing processes present a host of challenges. Not only must you navigate your own tax landscape, but you must understand your clients’ tax laws and invoicing regulations. These can include varying VAT rates, exemptions, and compulsory statements. If you rely on manual invoicing processes, this means keeping track of numerous (and often changing) requirements, as well as specific rules for format, sending and receiving channels, and archiving.
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- Navigating multiple invoicing formats
Depending on the country, each invoice may have stringent information requirements. International clients are subject to the invoice requirements per their country’s legislation. This means that your AR team must be well-versed in varying invoice formats and adjacent specifications.
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- Accommodating e-invoicing
Some international businesses bill exclusively using e-invoices. As a result, clients of such businesses need processes or systems in place to capture or process these e-invoices. This can add additional workloads for teams who are unable to process these automatically.
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- Customer data management:
Information security is more important than ever – and customers know this. When invoicing in multiple countries, you are required to secure customer data and comply with confidentiality and personal data protection regulations, such as Europe’s GDPR.
Needless to say, maintaining a streamlined (and healthy) relationship with international clients often requires a significant portion of additional time, resources, and research. It often poses additional technical complexity and compatibility issues, legal and regulatory challenges, and security and privacy risks.
Implementing an e-invoicing solution
By implementing an e-invoicing solution, the entire process becomes more streamlined, accuracy is improved, and businesses can rest assured that they are compliant with international standards, thereby facilitating cross-border interoperability. This shift can bring a sense of relief to your AR team, knowing that the complexities of global trade are being managed efficiently.
Alongside the benefits of e-invoicing, it’s also beneficial to look at the role of related technology such as accounts receivable automation. Simply put, automating the invoice and collection process accelerates the entire payment cycle. With international transactions known for their time-intensive nature, this marks a massive plus. AR automation fixes the root cause and decreases administrative delays while freeing up critical resources, allowing your team to focus on value-driven and strategic tasks.
Moreover, e-invoicing can improve cash flow by minimising the lag between billing and payment, increasing efficiency and transparency in trade relationships. This can empower your team, making them feel more productive and efficient, knowing their time is being used effectively.
International business made effortless with e-invoicing
Ultimately, invoicing bottlenecks shouldn’t stunt business growth. Neither should it stand in the way of acquiring (and retaining) international clients. With SARS already looking to modernise its VAT reporting system, the adoption of e-invoicing is likely inevitable. With that said, businesses have all the reason to be proactive and start reaping the benefits of e-invoicing before competitors catch up to speed. This strategic move can make your business feel ahead of the game, ready to seize the opportunities that e-invoicing brings.
To learn more about e-invoicing and the aspects to consider when selecting a e-invoicing solution, feel free to consult our tips and recommendations page or contact us for more information.
