e-Invoicing, Exponential Growth and Chinese Bamboo
e-Invoicing is a hot topic in the business world and software providers across Australia and New Zealand often ask OZEDI a basic question;
1. Why is OZEDI so confident that e-Invoicing will not only take off but continue to grow exponentially?
As a Digital Service Provider staring down the barrel of a very busy product roadmap this question is fundamentally crucial to consider.
In formulating a response to this query it is worthwhile to draw some parallels between e-Invoicing and the humble Chinese Bamboo tree.
Well the Chinese Bamboo tree has all the hallmarks that would drive a budding horticulturist absolutely stir crazy for at least the first 5 years.
Consider this… imagine planting a Chinese Bamboo seed and having to water it and care for it for around 5 years for nil result. And when I say nil result, I mean absolutely no growth above the surface at all – not even the hint of a shoot let alone a meagre stem with a couple of leaves.
Interestingly though, those 4 or 5 years of nurturing what is below the ground is what counts the most.
You see, after a period of 5 years the Chinese Bamboo plant is able to transform into a 27-metre tall tree in the space of 5 to 6 weeks. In fact, it’s been known to have growth spurts of over 1 metre in just 1 hour. At times, you can literally see the tree grow before your very eyes.
So how is the Chinese Bamboo tree able to achieve such an incredible growth rate and support a massive structure towering over 27 metres in height?
The secret lies beneath the surface and the extensive root system it cleverly develops over the preceding five years. Clearly, without this firm foundation, the Chinese Bamboo tree could not grow and support its own weight above the soil.
e-Invoicing… The Foundations
In 2016, the ATO formed the Digital Business Council to come up with e-Invoicing standards for Australia
· It has now been 3 years since the Australian Government adopted the Peppol framework and established the ATO as the Australian Peppol Authority.
· Access Points such as OZEDI have become accredited and many Digital Service Providers in Australia and New Zealand are now capable of sending and receiving eInvoices.
· The NSW Government from 1st January 2022 have mandated e-Invoicing and committed to payment terms of 5 days for eInvoices for contracts under $1 million.
· The Federal Government will follow suit from July 1, 2022
· Treasury have issued a paper on the Business e-Invoicing Right
· Most recently the ATO has earmarked August 15-21 for e-Invoicing week.
That’s an impressive list of drivers to date, but consider in the past week a major A-NZ business that uses a software provider that connects to OZEDI as an Access Point has successfully sent over 2500 eInvoices and this was an increase from over 1100 the week before and just over 900 the week before that!
The key to establishing the viral nature of e-Invoicing lies in the fact that each buyer and supplier has multiple trading partners that use a diverse range of different software packages that are fast becoming eInvoicing enabled. And because businesses only have to connect once to the Peppol network to send or receive documents, it’s important that software providers include e-Invoicing capability so they don’t leave themselves open to their clients looking to other parties for this functionality. OZEDI can enable e-Invoicing for digital service providers who in turn can maintain their competitive edge and offer the service to their clients. What’s more, OZEDI provides API documentation, testing environments and onboarding assistance to software providers at no upfront cost.
There’s no doubt that the increasing readiness of the Australian and New Zealand Digital Service Providers to switch their clients on to e-Invoicing will be the catalyst for the next exciting phase in the take up of e-Invoicing.
Just like the explosive awakening of the Chinese Bamboo tree, the e-Invoicing catch cry of “connect once, connect to many” will inevitably lead to its exponential growth across Australia and New Zealand.