EXL client realizes incremental discounts and vendor credits
Client
A leading industrial products and services provider.
Business Case
During a period of unprecedented growth the client needed support moving to a shared service model.
Scope
- Invoice processing
- Vendor reconciliation
- Freight invoice audit
- Vendor inquiry helpdesk
- Duplicate payment analysis
- Vendor master maintenance
Background
Following an intense period of M&A and joint venture activities by a leading industrial products and services provider, the firm found itself operating with disparate accounting and administrative systems. This created:
- Inadequate general controls around the three-way matching process.
- Significant exposure from duplicate payment and overpayments.
- Major variances in freight charges and surcharges due to market fluctuations and complexity of quotes.
The company decided to move the accounts payable process to a shared service model and needed a nimble and flexible F&A partner to help implement and maintain the process.
Who to Contact?
- Visibility into invoices enabled 3 days
- $3.8 million Enabled visibility of invoices within
- $2 million Average annual vendor credits collected
- Reduction in time to pay fully audited freight invoices 55%
The solution
EXL transformed payables by releasing working capital and improving visiblity for more proactive decision-making. The solution included:
- Establishing standardized payment terms for more than 10,000 vendors across 16 business units.
- Creating a three-way auto-match process and workflow exceptions.
- Designing a standard freight invoice process from the disparate logistics systems.
- Implementing independent past payment audit function to detect duplicate payments and overpayments.
- Rationalizing vendor contracts and payment terms to maximize vendor credits.
The results
- Improved cash flow and liquidity for day-to-day operations.
- Reduced daily payables outstanding (DPO) by 25 to 30%, resulting in working capital reduction.
- Better controls and transparency in large-ticket procurement items.
- Correction of historical anomalies in vendor payment terms.