Out-of-date systems and procedures for buying and selling
products and services often waste valuable time and money when carrying out the
admin associated with procurement. As such, many flooring contractors are
finding it increasingly difficult to juggle workloads alongside the
ever-increasing amount of relevant paperwork. Justin Moule, director of
Integrity Software’s Construction Division, looks at the ways in which
procurement processes can be simplified by switching to an integrated system
with electronic trading technology.
For many flooring contractors, paper systems and electronic
spreadsheets are often used to collate financial information and represent the
simplest way in which to create a system for purchase orders to suppliers,
invoicing to customers and retention records. However, this method of recording
important cash flow information makes it far easier for errors to occur, due
both to the manual nature in which data is entered into an electronic
spreadsheet and the un-integrated way in which important data is spread across
several different storage media.
Where this occurs, erroneous invoices and orders need to be
re-submitted at additional admin time and financial cost to the business. In
fact it is estimated that corrections to manual invoicing errors can cost a
company up to £1 per invoice. This is due to the cost involved in recording the
error, re-issuing the invoice and the postage and time delay involved.
A more relevant method, in an industry where more and more
suppliers and customers are moving to online processes, is electronic trading.
The smaller flooring contractor may find that this is suitable only for his
procurement processes, or for his invoicing processes, however for larger
flooring businesses this online form of trading stands to save significant time
and cost.
The risk of human error is removed by managing all
procurement and invoicing through an e-trading hub, while time and financial
cost can be reduced as a direct result. This is due to the integrated approach
with which construction industry-specific software with integrated e-trading
operates.
The term e-trading itself is often bandied around and at
first its meaning appears nebulous and may not seem directly relevant for the
flooring contractor’s business. Particularly at this time it is important for
businesses to consider where they make outlays, and ensure there is a direct
and tangible return on any newly introduced systems or processes.
Simply explained, e-trading is an electronic document
exchange system that allows flooring contractors to send and receive purchase
orders, invoices and other accounting documentation via the internet. This
process makes it virtually impossible for errors to occur due to the joined up
nature of a programme running it, such as Integrity’s Evolution financial
accounting software package.
When a series of information is entered in to the e-trading
software the entire system is updated to coincide. Operating in this way, the
software can also alert the user if the data does not appear to be correct,
allowing mistakes to be rectified at once and cutting out the risk of sending a
purchase order or invoice which needs to be corrected and reissued at a later
date.
Using e-trading through a construction industry software
package like Integrity’s Evolution means that the purchase information is
instantly linked to all other aspects of the business’s financial accounting.
Once complete, information can be sent directly to the
Inland Revenue via the Construction Industry Scheme portal, which Evolution is
directly linked to. This provides peace of mind to the flooring contractor that
their tax returns are error-free.
The flexible nature of a software package which enables
electronic trading of this kind allows the user, who in many cases is often the
business owner rather than a dedicated member of accounting staff, to tailor
the system to meet their own personal needs. This can be especially attractive
considering workloads and the need to manage all back office aspects of a
project too.
Electronic trading is not an intangible concept for other
business sectors, it is a relevant and real system for flooring contractors to
the construction industry to use in order to streamline procurement processes
and save time and cash for the business.
Visit Integrity Software at www.inty-software.co.uk
