Chase

What’s happening with e-invoicing support services for small businesses these days?

Minneapolis, MN-based financial services industry market research firm Barlow Research Associates, Inc. reported in January 2014 that two of the three large banking institutions that had been offering e-invoicing services have now retired those programs.

Indeed, you won’t find mention of them anywhere on their small business online banking websites.

Donna Arce, Barlow Research Associates — Donna Arce

According to Donna Arce, a Barlow Research client executive, both Chase and Wells Fargo dropped e-invoicing in 2013, making Bank of America the only one of the nation’s 14 top banks still offering this service. (Existing e-invoicing customers at Chase remain grandfathered in … for now.)

Reportedly, the reason behind the elimination of e-invoicing services was low usage.

But was this usage a function of low demand … or was it actually the result of limited market availability?

After all, Arce reports that overall invoice volumes are notable. For the typical small business enterprise, approximately 75 paper invoices and 10 electronic invoices are generated in any given month.

In the middle market segment, the volume of invoices is quite a bit higher: Those companies average just over 1,250 paper invoices and more than 250 electronic invoices in the average month.

For answers to the question about inherent e-invoicing demand, we can look to PayPal, one of several non-bank providers of e-invoicing services.

According to Chris Morse, a PayPal spokesperson, “millions of users” have accessed company’s online invoicing services – particularly since 2011 when the product was redesigned with more robust functionality and features.

For an analyst’s column she wrote on the topic, Barlow Research’s Donna Arce reported on remarks made by René Lacerte, founder and CEO of invoice management firm Bill.com, on the elements that are essential for making sure that e-invoicing is a viable solution for business owners.

Quoting Lacerte:

“Working in an entirely online environment is not realistic for many businesses, [which] need a receivables solution that will track and manage both paper-based and electronic invoices and payments in one system.

“Integration with accounting software is key to businesses adopting any financial management tool, including e-invoicing. Without integration, businesses must re-key data from one system to another, which is both time-consuming and can be fraught with errors.

“Issuing the invoicing and accepting payment are just part of the overall receivables process … The ability to collaborate with customers via a portal where invoices can be referenced, documents shared and notes exchanged, dramatically reduces the time businesses spend managing these inquiries.”

The PayPal approach is quite flexible in terms of the payment options for the recipient of the invoice. Choices include its own PayPal bill payment option, along with credit and debit card payments as alternatives.

Contrast this with Bank of America, which requires the recipient to log on to a payment center, agree to terms, and then upload account information to make a payment – debit and credit cards not accepted.

Contrasting PayPal and the approach of the commercial banks, is it any wonder that the one is experiencing growth … while the others have seen low usage?

Of course, there’s also the issue of fees charged for e-invoicing services. PayPal’s fee structure is different than how the commercial banks have charged for services, in that a portion of PayPal’s fee is based on a percentage of the transaction value (currently around 3%). Depending on each company’s individual characteristics, that pricing model may or may not be the most lucrative for users.

Bottom-line, it’s clear that e-invoicing isn’t a dying service. But how flexibly it’s presented – and the degree to which it can actually reduce inherently labor-intensive in-house administrative activities – spells the difference between its success or failure as a business service.

In other words … the difference between PayPal and the giant commercial banks.

What’s happening with the reputations of the leading U.S. corporations? Are we talking “bad rep” or “bum rap”?

Actually, it turns out that corporate reputations are on the rise; that’s according to findings from the 2011 Reputation Quotient® Survey conducted by market research firm Harris Interactive.

Each year since 1999, Harris has measured the reputations of the 60 “most visible” corporations in the United States. The 2011 survey, fielded in January and February, included ~30,000 Americans who are part of Harris’ online panel database. Respondents rated the companies on 20 attributes that comprise what Harris deems the overall “reputation quotient” (RQ).

The 2011 survey contained 54 “most visible” companies that were also part of the 2010 survey. Of those, 18 of the firms showed significant RQ increases compared to only two with declines.

The 20 attributes in the Harris survey are then grouped into six larger categories that are known to influence reputation and consumer behavior:

 Products and services
 Financial performance
 Emotional appeal
 Vision and leadership
 Workplace environment
 Social responsibility

Each of the ten top-rated companies in the 2011 survey achieved between an 81 and 84 RQ score in corporate reputation. (Any RQ score over 80 is considered “excellent” in the Harris study). In cescending order of score, these top-ranked corporations were:

 Google
 Johnson & Johnson
 3M Company
 Berkshire Hathaway
 Apple
 Intel Corporation
 Kraft Foods
 Amazon.com
 Disney Company
 General Mills

At the other end of the scale, the ten companies with the lowest ratings among the 60 included on the survey were:

 Delta Airlines (61 RQ score)
 JPMorgan Chase (61)
 ExxonMobil (61)
 General Motors (60)
 Bank of America (59)
 Chrysler (58)
 Citigroup (57)
 Goldman Sachs (54)
 BP (50)
 AIG (48)

Clearly, BP and AIG haven’t escaped their bottom-of-the-barrel ratings – and probably won’t anytime soon.

What about certain industries in general? The Harris research reveals that the technology segment is perceived most positively, with ~75% of respondents giving that sector a positive rating.

The next most popular segment – retail – had ~57% of respondents giving it a positive rating.

For the auto industry, the big news is not that it’s held in high regard (it’s not) … but that its ratings jumped 15 percentage points between 2010 and 2011. That’s the largest one-year jump recorded for any industry in any year since the Harris RQ Survey began.

What industries are bouncing along the bottom? Predictably, it’s financial services firms and oil companies.

But the news from this survey is, on balance, quite positive. In fact, Harris found that there were actually more individual companies rated “excellent” than has ever been recorded in the history of the survey. Considering the sorry state of the economy and how badly many brands have been battered, that result is nothing short of amazing