Giga's Total Economic Impact Research Shows Electronic Invoice Presentment and Payment Improves Profitability Even With Only 12% Customer Adoption

Business Wire, July 23, 2002

Business/Technology Editors

CAMBRIDGE, Mass.--(BUSINESS WIRE)--July 23, 2002

Payback From Investments Realized Within One to Two Years

New research using Giga Information Group's Total Economic Impact(TM) (TEI(TM)) model shows companies that implement electronic invoice presentment and payment (EIPP) can achieve a positive ROI with as little as a 12 percent to 15 percent adoption rate by customers if reasonable conditions are met. These conditions include the elimination of the corresponding paper invoices and the implementation of customer self help.

According to Giga, the demand for EIPP will only increase if the value (to both buyer and supplier) continues to grow. "We expect that most companies making an initial investment in EIPP will continue to see a positive return from the investment with payback within the first or second years," said Giga Sr. Industry Analyst Penny Gillespie.

As indicated in the report, while consumers (B2C) have been slow to adopt electronic bill presentment and payment (EBPP), corporate payers (B2B) have been quick to adopt EIPP due to the immediately recognized value. Not only do cost savings lie in migrating from paper to electronic delivery, additional benefits also exist in the areas of customer service, accounts receivable and marketing.

"A well-thought-out EIPP implementation reduces customer service calls relating to bills, decreases accounts receivable processing time and provides the opportunity to communicate consistently and personally with customers," said Gillespie. "As the invoicing and payment process become more streamlined, making it easier for payers to pay promptly and address disputed items through the use of partial payments, the days sales outstanding also decreases, putting money in suppliers' pockets more quickly."

Giga's TEI model involves four factors for analysis: cost, benefits, flexibility and risk. Giga's EIPP analysis is based on a sample implementation, and companies would need to calculate the actual TEI for EIPP based on circumstances at their company. Models will vary greatly by industry and company, but positive ROI is expected across the board, even for complex implementations where payback might be slightly longer as implementation and customization costs will be higher.

For additional information on Giga's report "The Total Economic Impact(TM) of Electronic Invoice Presentment and Payment" or for press commentary from Penny Gillespie, please contact Christina Thirkell at Giga, (617) 577-4965 or cthirkell@gigaweb.com.

About Giga Information Group

Giga Information Group is a leading global technology advisory firm that provides objective research, pragmatic advice and personalized consulting. Emphasizing close interaction between analyst and client, Giga enables companies to make better strategic decisions that maximize technology investments and achieve business results.

Founded in 1995, Giga is headquartered in Cambridge, Mass. and has offices throughout the Americas and Europe -- as well in Latin America, Asia/Pacific and the Middle East. For additional information, visit www.gigaweb.com.

(c) 2002 Giga Information Group, Inc.

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