New paperless invoicing system aims to cut costs

A Kenyan IT company promises to help firms cut costs and paper invoicing using a new automated electronic data interchange system.

Okova Waswa and his four colleagues teamed up and came up with an idea to tap the emerging opportunities in the retail market and registered Exito Africa, a local IT firm.

Exito Africa offers solutions that do away with paperwork during invoicing and purchase processes.

‘‘The process is called Electronic Data Interchange (EDI). The system leverages on an exiting Enterprise Resource Planning (ERP) in place or web portal to translate data format so that two trading partners are able to transact without printing the paper,’’ Mr Waswa, the founder, Exito Africa told the Business Daily in an interview on Wednesday.

It is powered by a Portugal-based multinational called Saphety involved in purchase-to-pay solutions, process optimisation, data and media synchronisation.

Saphety is owned by the largest non-financial Portuguese group —Sonae Group— which has interest in retail, real estate among other industries.

It has presence in Europe, Latin America, Africa and Asia, through local partnerships and is mainly involved in developing software solutions.

Exito Africa seeks to enhance efficiencies between suppliers and retailers by reducing costs involved in the supply chain, staff administration to ease transactions.

It also allows organisations to manage and reduce the invoicing and order costs in business environments where companies have to deal with a large numbers of customers and supplies.

‘‘With EDI solution, you can fully automate the exchange of business documents in your company and this will cost the user about Sh80 per transaction,’’ said Joseph Njenga, operations manager at Exito Africa.

‘‘The service eliminates the need for physical storage of the documents and this minimises fraud, and eradicates the need for employees to manually input business documents,’’ he said.

The tech firm is targeting retailers and their suppliers especially in the fast-moving-consumer-goods sector like makers of beverages, electronics and healthcare products.

Mr Njenga said that globally 5,300 corporate customers across 17 countries use Saphety solutions.

‘‘Some of the leading companies that are linked Saphety include Wal-Mart, Proctor & Gamble, Nestle, GSK, Reckitt Benckiser, Samsung, LG, Unilever, Loreal and Biersdorf,’’ said Mr Njenga.

He noted that the main challenge in Kenya is that most organisations are stuck with use of manual processes when purchasing or making orders.

‘‘This has a lot of inefficiencies and transactions are prone to human error thus affecting customer satisfaction. The manual processes also mean a lot of resources are dedicated towards staff doing monotonous manual jobs hence increasing operational costs,’’said Mr Njenga.

However, he said, few corporates in Kenya have automated their processes by creating their own web portals on the ERPs to manage their suppliers and customers.

‘‘But these portals usually require a significant investment in hardware, software development and in management as well as in management administration,’’ he said.

With the service, there is no investment in hardware or software and the system is designed to work with a company’s existing ERP through an integration process,’’ said Mr Waswa, Exito Africa founder.

The system is also applicable to even organisations without an ERP like small and medium enterprises supplying goods to the mass market.
Currently, the company has 10 employees.

Mr Okova said that many people in the corporate world are not familiar with the concept of paperless invoicing transaction and this has been one of their key challenges.

‘‘We foresee a situation where more organisations will be forced to embrace the technology given the high numbers of international companies entering the local market that will have business deals with Kenyan firm,’’ said Mr Okova.

‘‘On the positive side, most chief executive officers see the benefit of the service because they take a holistic view of the business and are accountable to the bottom line though streamlined efficiencies.’’

He said the decision to invest in the system was inspired by growth in small and medium enterprise sector.

Mr Okova further noted that the retail sector has been on growth with many outlets opening up across the country and sub-Saharan region.

He said that the firm is foreseeing a great potential especially from the manufacturers who intend to increase their service delivery by cutting costs through electronic data interchange.

He said the firm is seeking to diversify into other sectors to increase its clientele base, translating to higher sales.

‘‘Once we have the retailers and suppliers on board, we shall also look at healthcare sector, financial institutions, banks, oil marketers, telecommunication firms,’’ said Mr Okova.