Paper to Electronic: Automating Receivables

1. Paper to Electronic:Automating Receivables Bill Coward, VP Electronic Receivables Consultant June11, 2014

2. Agenda • Trends • What is causing new payment trends • Who is impacted • Minimize paper – transition to electronic receivables • How to move forward efficiently and cost-effectively • Highlight best practices and payment trends • Leverage technology to navigate the complexity of payment processing • Identify the pricing components of card processing • Outline best practices to insure lowest possible costs are achieved

3. trend trend trend trend trend Innovation is driving change • Mobile • Applification • Social Shopping • Cashless Society • T-Commerce

4. Which industries need a payments strategy?

5. Not just retailers anymore

6. Why?

7. Common goals… Consolidated reporting Single integration for multiple channels 6

8. The AR treasure hunt

9. Take your AR to best-in-class Clear payments in 1.3 days Reduce manual intervention by Adopt new technology with 50% $0 capital expenses Source: May 2012 Aberdeen study

10. The changing AR landscape • Increased complexity, cost, risk • Dual processes for checks, electronic payments • High cost to maintain, upgrade infrastructure • USPS service reductions • Regulatory pressures • No fallback with single-site operations

11. How leaders unlock hidden value

12. Your AR treasure map Electronicbilling Multiple payment channels Currenttechnology Single datafile Automatedposting Reduced exceptions

13. Where do you begin?

14. Present bills/statements electronically How it works • Leverage one supplier, one combined billing file for electronic and print delivery Value • Eliminates print/mail expense • Faster delivery improves DSO • Greater efficiency for AR staff

15. Enable multiple payment channels How it works • Manage all channels in one workflow • Deposit all items electronically Benefits • Increase customer satisfaction • Cut processing costs • Improve DSO Give your customers choices

16. Take your AR to best-in-class Clear payments in 1.3 days Reduce manual intervention by Adopt new technology with 50% $0 capital expenses Data Source: May 2012 Aberdeen study

17. Best-in-class accounts receivables 9x better 5x better 5x better Source: Aberdeen, May 2012

18. Payment Landscape Number of Transactions (billions) Debit card Credit card ACH Checks Stored value Source: Nilson, Federal Reserve, NACHA, ATM&Debit News, WF Analysis

19. Things to think about…

20. Leverage technology to navigate the complexity of payment processing

21. Interchange

22. What do Merchants Pay? Components of Merchant Pricing

23. What impacts interchange costs Payment Channel Card Type Merchant Category Code System Configuration

24. Interchange optimization

25. Level III and Large Ticket Data Requirements Level II Data • Tax Indicator denoting presence of sales tax • Itemized Sales Tax amount (must be greater than $0) • Customer Code Level III Data • All Level II Data • Transaction Summary (order date, invoice number, etc.) • Line Item Detail (i.e. item description, product code, quantity, unit cost) Reality Check – There are limited software and payment gateway applications that are certified to capture the required data to process Level III and Large Ticket transactions

26. “Do not lose sight of the importance of quality. Selecting and enabling technology is more complicated than checking a box or finding the lowest-cost provider.” Article by The Aberdeen Group