Managing invoices is a crucial aspect of running a business, whether it involves selling products or providing services. In this article, we will explore billing statistics, with a focus on the rise of electronic invoicing, payment management, and trends observed in the UK.
Over the years, UK businesses have increasingly adopted electronic invoicing. According to a study by HMRC, around 25% of invoices issued in the UK were electronic in 2020. This figure continues to rise, especially with the introduction of mandatory electronic invoicing for certain businesses in the context of VAT management.
The adoption of electronic invoices offers several advantages, particularly in terms of reducing the costs associated with document management and archiving. A Xerox study estimates that a business can save up to £10 per invoice by switching from paper to electronic invoicing.
The number of invoices issued and received by businesses varies depending on the size of the company, its industry, and the nature of its commercial transactions. Large businesses, especially those with high turnover, issue thousands of invoices every year.
For example, in the services sector, a business may need to issue several hundred invoices per month, while in the industrial sector, the frequency of invoicing may be lower, but the amounts involved may be much higher.
One of the most sensitive points in managing invoices is payment deadlines. In the UK, payment terms are regulated by law, but they often remain a point of contention, particularly in industries where relationships between customers and suppliers are tense.
Businesses can use a variety of tools to improve payment management, such as online payment platforms or invoicing software that automates reminder notifications.
Electronic invoicing between businesses is now the norm in many European countries. In the UK, this trend has accelerated in recent years thanks to initiatives like Making Tax Digital (MTD), an electronic invoicing system set up by the UK government to simplify tax management and strengthen fiscal control.
According to a report published in 2023 by the European Commission, the UK is one of the leaders in electronic invoicing in Europe, with more than 60% of B2B invoices exchanged electronically.
Invoice management is not just about issuing and receiving customer invoices; it also involves managing supplier invoices. A business must track the entire lifecycle of invoices: from creation, receipt, and registration in the accounting system to payment.
It is essential for businesses to maintain a balance between managing customer and supplier invoices. An invoice management tool should allow businesses to track payments due to suppliers while also monitoring payments received from customers.
Despite the progress made, managing invoices remains a challenge for many businesses, particularly when it comes to billing errors and late payments.
To avoid errors, it is recommended to use invoicing software that automatically verifies information before invoices are issued. These tools can also generate detailed reports on the status of payments and alert managers when action is needed.
Apps like Bill Up help facilitate daily invoice management. This app allows you to scan, organize, and pay your bills directly from your smartphone or computer.
Invoice management is a significant challenge for UK businesses. By investing in digital tools like Bill Up and improving transparency in billing processes, businesses can strengthen relationships, improve cash flow, and ultimately increase profitability.
