B2B eInvoices, Dynamic Discounting And Expense Management In The Cloud

The week’s data was filled with a few contradictions among analysts. For instance, electronic invoice volume is soaring to new heights, but paper invoicing is far from going extinct. New stats on small businesses find modest economic optimism but slowing hiring and spend. Plus, researchers conclude that SMEs are improving their ability to mitigate foreign exchange risk, yet the data isn’t exactly promising.

We break down all of these numbers below, plus new research on the rise of invoice discounting and cloud-based expense management, the importance of corporate bank branding and the three months out of the year that are particularly brutal to small business cash flow.

5 billion B2B eInvoices will be circling the globe this year, says new research from electronic invoicing firm Billentis. That figure is coupled with a forecasted 14 percent increase in B2B eInvoice market growth for 2016, with the North American market alone to see a potential 18 percent increase in eInvoicing volume. The stats aren’t necessarily a win for digital B2B payments, however. According to Billentis, paper-based invoicing will continue to hold its ground. In Germany, for instance, 69 percent of buy-side companies actually print out an invoice when it’s received digitally; as much as 70 percent of eInvoices are printed out in Latin America.

75 percent of SMEs hold a positive outlook for their businesses, marking the highest statistic for this metric in four years for the National Small Business Association’s 2015 Year-End Economic Report. The research overall concluded mixed results for economic outlook among small business owners; still, the NSBA pointed to “modest” improvements in this arena, including access to financing, hiring practices and employee compensation.

71 percent of corporate treasurers like an invoice discount, says a report from invoice financing firm C2FO. The analysis was conducted among U.K. corporate treasurers in the last quarter of 2015. Researchers concluded that these professionals agree that invoice discounting — receiving a discount on a purchase for settling an invoice early — can provide added value. Nearly all of them (96 percent) said the role of supplier financing is on the rise.

66 percent of SMEs say a bank’s brand reputation plays a big role when deciding who to do business with — as much of a role as price does, in fact. The latest Greenwich Market Pulse report found that with more than one-third of SMEs expected to increase their capital expenditure spend within the next year, financial institutions will need to not only compete on price but on their brand’s reputation — that means customer service, financial condition and the bank’s commitment to a relationship with business clients. Smaller companies additionally want their banks to be able to provide fast decisions and avoid red tape, researchers added.

52 percent of SMEs in the U.S. said they were hiring in January, a slight decrease from the 55 percent that said the same in December. The conclusion led analysts for the NFIB Small Business Optimism Index to drop the score; small business optimism declined at the start of 2016 as fewer qualified job applicants reached SMEs and fewer businesses reported rising sales in the last quarter, compared to earlier index reports. Further, researchers found a decline in capital spending, while 3 percent of small business owners said their borrowing needs remain unfulfilled. However, even less — 2 percent — said financing is their top concern. 

19.2 percent CAGR will hit the cloud-based expense management market between 2016 and 2020, declares a new research report released last week. That annual growth rate covers markets not only in North America but in South America, Europe, the Middle East, Africa and the Asia-Pacific regions as well. It’s good news for companies like Concur and Ariba, highlighted by the report as key players in the SaaS corporate expense management market. But data security concerns could separate the winners from the losers as the market grows, researchers warned.

25 percent of small businesses aren’t adequately avoiding foreign currency risk in the U.K., says a new report by East & Partners. According to researchers, up to 90 percent of businesses with more than €20 million in annual turnover deploy strategies to mitigate against foreign exchange risks; but, for businesses with revenues of less than £20 million, less than a quarter do the same. Regardless, analysts believe there is a trend of growing sophistication in the way businesses in the country handle international risk mitigation. 

3 months out of the year are particularly brutal for SMEs when it comes to cash flow, according to analysts in the U.K. Hitachi Capital Finance says they are April, July and October. April’s an easy one: It’s tax season, researchers say, and new legislation will come into effect that month that could increase workforce recruitment costs. But the inclusion of July and October are a bit less obvious. According to reports, holiday periods mean fewer people in the office to track down outstanding invoices, and heightened demand can squeeze a business’ resources.