Why not to measure the price per invoice, when looking for an effective P2P process?
The current industry measure for the effectiveness of an organisations invoice process is the percentage of those invoices that are straight through processed (STP). i.e. invoices that require no manual intervention or rework to approve and pay the invoice.
Ensuring the correct process design is implemented and operating as effectively as possible is the goal of the Oxygen Early Payment Programme – to enable as many invoices to process automatically through the system, with payment made to the supplier within 1 banking day (or day 7 for disputed invoices).
We have therefore focused our solution on those designs and best practices that deliver this goal. A summary of some of the key principles that drive efficiencies and business benefit are:
We invite you to join our webinar to understand more about how to build the business case for an early payment programme. On this webinar Clive Boddington, Head of Operations at Oxygen Finance, will explain his experience working with Oxygen’s public sector clients. You will understand in greater detail how your business could start to:
Date – 15th March 2016
Time – 11am-11.30amSign Up
After the success of last year’s CIPFA Scotland, we will be attending the conference again this year at the Radisson Blu Hotel in Glasgow.
The Scottish public sector is already showing increasing interest in the Oxygen solution. Aberdeen City Council signed up last year and have suppliers experiencing early payment.
Simon Whittle, Director of Client Solutions and Gareth Kentish, Head of Sales will be at Stand Number 8 on both of these days and will be very pleased to meet with you.
More information about the conference can be viewed here www.cipfa.org
Arrowgrass Capital Partners LLP (“Arrowgrass”) have today completed the purchase of Oxygen Finance Ltd (UK) and Oxygen Finance Americas Inc (US). This purchase and the capitalisation of the Oxygen businesses will enable accelerated development in a growth marketplace.
Oxygen Finance provides a technology platform and professional services solution for its clients, large buying organisations – allowing them to unlock value within their supply chains through paying suppliers ahead of contracted terms.
Arrowgrass Capital Partners LLP is an alternative asset manager head-quartered in London. Arrowgrass has more than 100 employees operating from offices in London and New York, and has more than $5billion in institutional Assets under management.
Arrowgrass CEO, Henry Kenner said “The Oxygen business model has great potential for global growth and supports our investment strategy in the alternative finance sector. We look forward to supporting this venture with our expertise and seeing its potential fulfilled.”
Oxygen Finance CEO, Ben Jackson said “We have grown steadily in recent years but the impact of Arrowgrass as an owner will allow us to accelerate both client acquisition and secure our position as the leading Early Payment provider”
The success of a Supplier Incentive Programme is one that engages all suppliers across the organisation. A significant area of spend within the Public Sector is Construction, such as Highways, Capital Projects, House Building, specifically expenditure covered by the Construction Act (Regulations 1998 (Amendment) Regulations 2011).
The key elements of the Construction Act that relate to payments (and are enshrined in standard forms of contract such as SBCC, NEC and JCT) are set out in the diagram below:
What are the challenges?
The Construction Act can be confusing, using the concept of ‘Due Date’ as the trigger point from which to measure the date for a certificated payment (i.e. 14 days from Due Date in the diagram shown). The duration between Common Valuation Date and Due Date and also the duration between Due Date and Final Date for Payment can be varied from those in the standard forms of contract.
The challenge many organisations face is that finance systems typically use the invoice date (or a related date such as invoice received date) as the trigger for calculating the final date for the payment of an invoice.
A further challenge is the compliance to the Late Payment Legislation, with many organisations at odds to this reporting requirement and the signed supplier contractual agreement.
How can Oxygen Finance help?
At Oxygen we have looked to standardise and align processes and principles across all organisational spend areas, to embrace both the Construction Act and Late Payment Legislation. By adopting ‘best practice’, we unify the net term period (i.e 30 days) from the Application Date.
Apart from clarity within the supplier community we deliver:
What is the result?
A significant benefit is that this mechanism captures the entire period from Application Date to Final Payment Date. There is an incentive to optimise the entire process. This front-to-back control really resonates with suppliers as there is less confusion, improved clarity for both you and your suppliers and a consistent payment performance overall.
Our recent webinar with Steve Loach, Strategic Financial Services Manager, at Barnsley Metropolitan Borough Council (MBC) turned out to be a great success and allowed those considering our solution to have an interesting insight into our work and success at Barnsley MBC.
Steve has been one of the key influencers at Barnsley MBC to help with the execution of the Premier Supplier Programme (PSP) with the Oxygen team and we are very thankful for his glowing review of the programme.
The council and their suppliers are experiencing improved efficiencies and a new income stream for the council since the PSP went live in 2014. There are now 250 suppliers signed up to receive early payment on average day 11 (ahead of 45 days in 13/14).
To listen to this 20 minute webinar all you have to do is register to our Oxygen members’ site where you will then be able to gain access to this webinar and other interesting resources.
Oxygen Finance welcomes the Government’s initiative to encourage all public sector bodies to adopt electronic invoicing. The government believes that electronic invoicing could save the public sector and its suppliers £2 billion per annum by streamlining UK government administrative processes.
The old fashioned method of sending paper invoices by post as we all know can cause backlogs due to the slowness of approval and invoices can get lost along the way. We often hear in the news that suppliers are getting paid significantly later than their contracted payment terms. Suppliers are then left feeling annoyed and frustrated and SMEs in particular struggle with cash flow.
With increasing government cuts due this year and councils looking for more ways to save money there is no better time for the public sector to think about implementing e-invoicing to streamline their processes, save costs and pay their suppliers more consistently.
A new European Commission procurement directive (2014/55/EU) has been passed through the European Parliament. The directive makes it easier for businesses to transact electronically and the UK government is aligned to meeting the deadlines set by the European Commission, making e-invoicing in procurement mandatory from 2016 with an objective of making it the predominant method by 2020. It is estimated that 20% of transactions in the EU currently are electronic.
E-invoicing benefits buying organisations and suppliers alike. Oxygen also believes that it is one of the key enablers to maximise the income from an Early Payment Programme and offers different solutions to its clients.
High-level benefits of e-invoicing include:
As part of Oxygen’s Early Payment Programme we include e-Invoicing as an optional component, creating an environment in which both buyer and supplier enjoy the benefits of streamlining their purchase to pay operations.
Following the success of our webinar with Eversheds we are pleased to announce that on Thursday 28th January from 3-4pm we will be holding a Barnsley Case Study Webinar with Steve Loach, who is Strategic Finance Manager at Barnsley Metropolitan Borough Council.
Barnsley Council have worked with Oxygen for three years and the interview with Steve will help explain the challenges that the Council had faced and the reason they decided to engage with Oxygen Finance. It will also cover Barnsley’s experiences and the outcomes they’ve achieved from implementing their Premier Supplier Programme. After the 20 minute webinar there will be time for a Q&A session in which both Steve Loach and Simon Whittle, Director of Client Solutions at Oxygen Finance will answer your questions.
If you are interested in signing up to the webinar please email Katrina.Mowbray@oxygen-finance.com to register, as there are limited places available.
Last month we were delighted to collaborate with international law firm Eversheds, to hold a webinar about the new obligations and potential exposure the Public Sector is facing due to the Prompt Payments Legislation.
In the webinar Gareth Kentish, our Head of Sales, was joined by Shaun Jamieson, Legal Director at Eversheds and following Gareth’s introduction , Shaun went on to cover the following topics:
This webinar can be viewed in our new Oxygen Finance Members’ Area, which you can access by registering here today. Once you have registered you will be able to login here www.oxygen-finance-members.com.
The Late Payments Legislation webinar recording is now available to view in our new Oxygen Finance Members’ Area, which you can access by registering here today. Once you have registered you will be able to login here www.oxygen-finance-members.com.
Registration will also will give you free access to our library of Payment Insight materials to which we will be adding forthcoming webinar recordings as well as a range of white papers and case studies that offer a bank of knowledge and resources for you to draw on.