PDF Invoicing – dispelling the myths (with a bit of help from the Bard)

PDF Invoicing – dispelling the myths (with a bit of help from the Bard)

Posted by Richard Manson in AP Automation, e-invoicing, Electronic Invoicing 10 Mar 2014
Today, we’re deligthed to welcome another guest post from Richard Manson from CloudTrade

Truth is truth, to the end of reckoning

I often hear the statement (usually from market space competitors) that PDF invoicing is not really electronic invoicing. Yet, in most cases this statement is simply not true.

Before we get in to the details, we first need to agree on what an e-invoice is.

What’s in a name? That which we call a rose (or an e-invoice). By any other name would smell as sweet.

Purchasing Insight logoThe widely accepted definition is that “an e-invoice should contain data from the supplier in a format that can be entered (integrated) into the buyer’s Account Payable (AP) system without requiring any data input from the buyer’s AP administrator” (http://www.einvoicingbasics.co.uk)

This makes sense. E-invoicing is all about removing paper and receiving electronic invoice data automatically into the buyer’s processing application. By doing so, operating costs are reduced, and transparency and controls are increased.

So if we accept this, then the next question is when is a PDF invoice an e-invoice? And, for that matter, when is it not?

To be, or not to be (an e-invoice), that is the question

Let’s look first at when it’s not. Simply put, it is not an e-invoice when a paper document has been scanned and the image – or photo – of the invoice is carried in the PDF. In this instance, the PDF is merely a ‘dumb’ image file. There is no physical invoice data carried in the PDF and it will require OCR technology to try to read the ‘photo’ of the invoice.

However, when a PDF is ‘machine generated’ i.e. produced directly from the application raising the invoice (which most are), in almost all cases it will be a text PDF, with the invoice data embedded directly within the PDF.

As machine generated text PDFs represent the majority of PDF invoices flying between organisations, the question then must be asked: what is the difference between a solution that maps an XML or EDI document, to a solution that maps invoice data carried in a PDF into “…a format that can be entered (integrated) into the buyer’s Account Payable (AP) system” (which is what CloudTrade do if you haven’t already guessed)

There isn’t any. So why do we still hear ‘pdf invoicing is not real e-invoicing’? Two main reasons:

  • Firstly, unless you are a bit of a geek (which I am), you may not realise there are different types of PDF or realise that the vast majority of PDF invoices are machine generated, with the raw invoice data available to use… if you just have the know-how.
  • Secondly, there is undoubtedly some scaremongering going on in the market.

CloudTrade has spent many years mastering what we do. We have a patent-pending, and we are enormously proud of the solution we offer. Conceptually it is straight forward to understand, but technically it is quite challenging – which is why we haven’t come across anyone that offers exactly what we offer.

At CloudTrade we’ve cracked the technical problem and are keen to apply it to business problems. The technology is accessible to large and small suppliers alike, and enables successful e-invoicing for organisations.

All the glitters is not gold

Traditional EDI/ XML mapping services and invoice portals – when you strip them back – are quite simple technologies. This is why there are so many service providers in the market.

However, asking a supplier to make changes to their applications and infrastructure to be able to send XML or EDI files; or asking a supplier to log on to a 3rd their invoice; simply moves the problem from one party to another. This is why adoption rates are so low, when only these two invoice submission options are available.

Such stuff as dreams are made on

E-invoicing should be free for suppliers, easy to use and non-disruptive – only then will suppliers move away from paper. Almost every accounting and billing application can generate a PDF. Suppliers don’t need to change applications, infrastructure or processes to move to PDF invoicing. This approach can deliver high adoption rates – typically more than 90% of suppliers, when asked, will email PDF invoices.

And when you can achieve these sorts of supplier adoption rates, a successful e-invoicing project is guaranteed!

Be not afraid of greatness

CloudTrade can be found on twitter @CloudeTradeNet

  • Scott Pezza March 12, 2014 at 5:25 pm /


    You bring up an important point. With the prevalence of paper invoices (and the imaging/scanning/mapping required to convert them to true data), extracting the information embedded in a PDF seems like a great way to cut down the time spent on dealing with physical documents.

    The only counterpoint I can see is more theoretical than practical at this point: that PDFs still require mapping since the data is structured based on the Adobe schematics rather than on a commonly-understood standard. It’s a fairly weak point, since we’re struggling more with the transition from paper to electronic than we are with high adoption levels of competing standards. Until UN/CEFACT’s CII (or some other) truly wins the day, PDF-based data extraction seems like a very interesting option — provided the fees aren’t wildly different than a buyer would pay to handle the paper.

    I have the feeling that, even when we think we’ve seen the last of them, paper invoices will still manage make their presence felt (if only in nightmares) much like Hamlet, Sr.

    “Ay, thou poor ghost, whiles memory holds a seat
    In this distracted globe. Remember thee!”


  • Neil Robertson March 28, 2014 at 9:34 am /


    Excellent post! We regularly come across “e-invoice” purists that argue against alternative approaches to solving the problem of how to get rid of all the paper.

    These folks sometimes seem oblivious the simple fact that only a tiny percentage of most organisation’s suppliers can generate a “pure e-invoice” and most companies don’t have the functionality in their ERP solutions to receive and process them anyway.

    For most small and mid sized businesses, “pure e-invoicing” is a long way off. As important, they really are not interested in the technical debate, they just want a solution to their problem now.

    Our market analysis shows that every company should expect over 95% of their purchase invoices can easily be delivered as a PDF via email. It is simple for the supplier and saves them a lot of time, costs (ink, paper, envelope, stamp and 2 -3 days for delivery). As important, if the supplier’s invoice matches the corresponding order / receipting, it can be posted into the ERP solution for payment within a matter of a couple of minutes from the email being sent, so they get paid on time.

    The only remaining challenge is to make sure it is affordable irrespective of how many invoices the business receives.

    We will never fully automate the window cleaner’s hand written invoice, but frankly, in the real world who cares?

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