As anyone running a business or household knows, utility and energy expenses take a huge bite out of monthly budgets. For the large enterprise or organization operating with hundreds of locations, wrestling with volatile energy and utility costs and keeping track of the spend can be overwhelming.
In fact, an industry study shows that utility costs account for 1-2 percent of sales for the average business and 4-5 percent of cost of goods sold for manufacturers.
Many companies handle utility and energy expenses with a combination of manual and homegrown processing systems, spreadsheets, stand-alone databases or paper files.
Unfortunately, this means that expense information is spread over a variety of places: in utility bills, within emails with procurement, in spreadsheets, or in the file folders of site operational staff.
For today’s companies, these methods are problematic. When invoice management is decentralized throughout departments, individuals and systems, it’s difficult to gain visibility into the utility and energy spend, how energy is consumed, and where it is being wasted. Bill validation, regulated rate review and other tasks are a hassle. It’s also a challenge to understand how to best take action to control energy and utility costs and generate savings ideas.
Improving Energy Invoice Management
Considering this scenario, most organizations see the value in moving away from siloed invoice management processes.
The highest performing companies make centralized utility and energy management part of their overall telecommunications expense management efforts.
When energy and utility bills are managed centrally with an automated solution, companies gain visibility into how energy is consumed and where it is being wasted. With this information, companies have the tools to prioritize action.
Typically, centralized utility and energy invoice management delivers the following:
- Improved utility contract negotiations
- Streamlined expense reconciliation
- Efficient management of utility expenses across multiple locations
- Improved strategy for generating savings and credits
- Integrated payments
- Improved visibility and reporting
What’s the payoff to this approach? An industry association shows that those enterprises streamlining utility and energy expense management realize significant business benefits. Typical organizations report savings of 10 to 20 percent from their utility and energy management initiatives.
Savings come from improving sourcing and contract negotiations, through an understanding of the deregulated energy opportunities; automating manual processes; consolidating invoices to reduce the volume of payments; automating invoice management and validation; and improving contract review, among other areas.
Energy Invoice Management – Next Steps
With automated, centralized utility and energy invoice management, companies can now better tame volatile costs.
Looking to give your organization the visibility it needs to take control of energy costs?
Contact the AMI team to get the process going.