Bridging the Gap of Electronic Invoices for Restaurants

John Enny More Posts
John Enny
2 months ago
Bridging the Gap of Electronic Invoices for Restaurants

Public Service Announcement: Electronic invoices for restaurants present a problem that affects ALL restaurants!

That’s right…you heard it here first. Electronic invoices, whether in the form of EDI or a digital document such as a .pdf, present business process challenges for each and every restaurant. And, that problem comes in 3 flavors:

  1. Your restaurant receives NONE of your vendor invoices electronically.
  2. Your restaurant receives SOME of your vendor invoices electronically.
  3. Your restaurant receives ALL of your vendor invoices electronically.

Before we dive into why each of these scenarios presents a challenge and what you can do about it, let’s first review what electronic invoices for restaurants are.

What is EDI?

When we’re talking about electronic invoices for restaurants, we’re mostly talking about EDI.

EDI, or Electronic Data Interchange, is defined as an electronic exchange of business documents and data between business partners. In order for the transaction of the documents and data to be compatible by systems on both sides of the transaction, the exchange is executed in a standard electronic format.

What is EDI for Restaurants?

The benefits of electronic invoices for restaurants include:

  • Cost Savings
    • Reduced costs related to processing paper orders and invoices including printing, storage, filing, postage, document retrieval, and – worse of all – data entry
  • Speed & Accuracy
    • Transmitting electronic data speeds up transaction business cycles and improves data accuracy due to reduced data entry errors
  • Efficiency
    • Data is transmitted in a timely fashion and the time saved from processing manually can be reallocated to higher value tasks
  • Visibility
    • Real-time visibility into transaction status enables faster decision-making and improved responsiveness to customer demands

For much more detail on the subject of EDI, check out the EDI Basics website.

Why are Electronic Invoices for Restaurants a Problem?

Electronic invoices sound like a great thing, right? So, why don’t all vendors and restaurant technology systems accommodate EDI?!?

It’s just not as straightforward as you would hope.

That “standard electronic format” mentioned above actually consists of various standard formats. And, even if two business partners have agreed to one standard electronic format, you still need to translate that standard format into a file format that can be integrated with your restaurant management system.

In other words, each vendor has their own EDI format, and each restaurant management system needs the data in a different way.

It can also be really time-consuming and expensive to get set up for both vendors and their clients. So, back to the three scenarios of why EDI can be a problem impacting ALL restaurants…

1. Your restaurant receives NONE of your vendor invoices electronically.

Problem: If your restaurant receives NONE of your invoices electronically, then you’re probably dealing with A LOT of paperwork and manual data entry. To put it simply, this can be time-consuming, prone to errors, and, of course, expensive.

If this applies to you, you can read all about the benefits of accounts payable automation for restaurants.

2. Your restaurant receives SOME of your vendor invoices electronically.

Problem: If your restaurant receives SOME of your vendor invoices electronically, this leaves what we like to call the “EDI Gap”.

The EDI Gap represents the remaining paper invoices that still need to be processed manually and input into your accounting and inventory management systems. These paper invoices may come from vendors who cannot accommodate EDI, such as produce vendors, or non-food and beverage invoices, such as utility bills, cable/communications, maintenance, etc.

Often, this work is performed by in-store general managers or chefs who can spend their time in better ways than doing paper processing and data entry.

3. Your restaurant receives ALL of your vendor invoices electronically.

Problem: If your restaurant receives ALL of your vendor invoices electronically, you might think you’ve got all of your AP problems solved. No paper invoices for your operations or finance team to deal with. Right? Maybe not.

As in the SOME case above, you might have non-food and beverage invoices, or corporate invoices, that are still delivered in paper form, or even emailed, that still need to be processed manually.

But, that’s the not the real problem. The real problem is that you’ve built a business process that is beholden to your vendor.

As mentioned above, not all vendors can accommodate EDI. Therefore, if you ever wish to seek alternatives – perhaps to pursue a new vendor for better pricing or a different quality product, you would have to ensure that vendor offers EDI and in a format that your systems can accommodate.

Is sourcing all of your ingredients from a single vendor the best option for your business? Or is it the default option because it’s the only way to operate an efficient procurement operation?

Bridge the EDI Gap with xtraCHEF

What if there was a way to aggregate all vendors into a single EDI by converting paper invoices into one multi-vendor EDI? Good news!

xtraCHEF bridges the EDI Gap by digitizing invoices – regardless of vendor, geography, or system into a single multi-vendor EDI. xtraCHEF digitizes all invoices – from handwritten farm vendor invoices to maintenance or utility bills.

Reconcile deliveries and mark up invoices for vendor credits at the point of receipt. The data that enters your system will already reflect reality vs. having to re-do that work after the fact.

Are you ready to bridge the EDI gap at your restaurant? Request a demo of xtraCHEF today.

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