Creating a persuasive argument for implementing an outsourced Utility Bill Management (UBM) service within your organization can pose challenges in quantifying and articulating its benefits. In response to growing customer demands, we’ve developed this guide to help explain key considerations when constructing and evaluating the business case for UBM.

Traditionally, companies would funnel utility bills to their accounts payable departments for assessment, processing, and payment, much like any other business expenditure. However, for multi-site operations, this conventional approach proves inadequate when faced with either a high volume of invoices (800+/month) or increasingly complex, high-value invoices that are challenging to validate.

Invoice Processing and Payment Cost Calculator

Processing, verifying, approving, and paying supplier invoices is a major challenge for accounts payable teams, with costs ranging from $15-20 per invoice, and most companies averaging about $12. Analysts like Aberdeen Group and Paystream Advisors note that best-in-class metrics are $6 or lower.

This calculator enables you to assess your organization’s productivity in invoice processing and payment.

For large and medium-sized enterprises, managing utility bill processing, payment, and administration often consumes a significant amount of time for accounts payable teams. Utility invoices typically demand prompt attention, with payment expected within a tight fifteen-day window from the date of issue.

On average, each facility maintains between three and five utility accounts, covering services such as electricity, natural gas, water, sewer, trash, and telecoms. Any expansion in the number of locations directly impacts the resource demands on accounts payable teams.

Despite this, accounts payable functions frequently remain overlooked for outsourcing, given the perception that financial management is a core organizational activity. Nevertheless, the complexities involved in managing numerous vendors and processing a multitude of utility bills within stringent timelines necessitate a different approach. The typical process includes time-consuming tasks such as re-keying invoices, reviewing and routing approvals, communicating status and solving issues, and remitting and reconciling, all of which add to the burden of accounts payable departments.

Enterprises now have access to specialized firms like Vervantis, which streamline the receipt, processing, validation, and payment of utility invoices. These solutions not only offer cost savings compared to internal processing but also provide extensive data for reporting, efficiency analysis, overspend identification, and disconnection prevention.

Efficient Management Options

While outsourcing is a recognized strategy for effectively handling various non-core functions like janitorial services and facilities management, utility bill payment often remains overlooked.

Vervantis empowers businesses to significantly reduce utility management costs by eliminating the risks of late fees and service disconnections.  Our proprietary software captures every detail from your utility invoices, giving you complete transparency into your energy expenses.  This detailed insight allows us to uncover hidden savings, such as correcting billing errors, reducing excessive consumption, optimizing rates, and enhancing energy procurement strategies. Essentially, we transform the way you interact with your energy data.

Key Value Drivers

Paying utility bills can be both costly and time-consuming. Automating invoice collection, ensuring timely payments, resolving billing queries, and managing payment exceptions are just a few of the value propositions. Utility bill management also entails error identification, processing streamlining, simplified payment procedures, and reduced administrative burdens.

Considerations for Success

Outsourcing utility bill management offers various benefits, including:

• Cost Avoidance: Significantly lower cost compared to internal resources, with processing invoices internally averaging $12.44 per invoice.
• Validation: Robust processes to accurately assess rate classes, contract rates, consumption, and line items, with predefined variance levels to flag errors and overspending.
• Speed: Swift and accurate processing, typically within 48 hours from invoice receipt to funding file creation.
• Penalty Mitigation: Proactive management to minimize late fees and disconnections, resulting in an 85% reduction in late fees within the first 90 days.
• Data Accuracy: Comprehensive capture of line-item data from utility invoices, enabling detailed reporting and analysis.
• Efficiency: Faster processing, enhanced security, and dedicated utility specialists managing all administrative tasks, ensuring 100% visibility into charges and approval channels.

By leveraging an outsourced utility bill management service like Vervantis, organizations can streamline operations, reduce costs, enhance accuracy, and free up internal resources to focus on revenue-generating initiatives.

For more details, a software demo, a proposal, or just a quick conversation with our experts, feel free to get in touch with our team. You can reach us here.