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Vendor Management Systems - a hardship on small companies - any recourse?

Lindsay Sarvadi's Profile

We are a small IT Firm that works with mostly Fortune 100 companies. We have noticed a trend towards Vendor Management Systems where we are required to gain access to a platform where we can enter our invoices, upload POs and generally conduct most of our financial inquiries. I would guess that this holds true for approximately 70% of our clients. This has become extremely time-consuming for our staff as it takes an average of 10 minutes in addition to invoice generation to log-in to and submit invoices with the client specific requirements. Not to mention, we have over 40 unique log-in accounts and are forced to take training for each of these systems in order to learn how to use them properly. Often this training (in the form of PowerPoint presentations, endless PDF documentation or videos) takes upwards of 4 hours. Additionally, the systems require constant updating of corporate status such as D&B report filings, Small Business Certificate uploads or diversity compliance. Some of these systems are extremely convoluted, a few even requiring that we obtain special authentication and a security token for unique codes we must use in order to enter an invoice. To add insult to injury, many of these systems require that we PAY to use them (buying invoices, payment for the tokens, etc.). We are stretched to our limits with our small staff and this has become a monthly frustration that we obviously cannot avoid -- we are forced to use this method of invoice entry and make the payments otherwise, we wont be paid. I am furious that these companies call it "the cost of doing business" when clearly the cost is being passed on to their much smaller vendors. Worse yet, many of them have now moved to 60 day payment terms (some 90!) in what they describe as "industry standard". But the VMS is supposed to be a more efficient way to enter invoices and receive payments! So - now that my complaining is out of the way, on to my question, and thanks for listening: Has your company countered these systems within your SOWs/Contracts? Have you made adjustments? We are debating a surcharge for every invoice that requires submission other than a simple email/US Mail. Has anyone had success with something like this? If I knew I'd be spending the majority of my accounting career answering security questions, making up tricky passwords and basically working for my clients as their payables data entry clerk rather than helping my own company develop financially, I would have gone to work for them instead :-(


Topic Expert
Regis Quirin
Title: Director of Finance
Company: Gibney Anthony & Flaherty LLP
LinkedIn Profile
(Director of Finance, Gibney Anthony & Flaherty LLP) |

We have large customers that require e-billing systems. I understand your frustration, as we are required to use four different systems. If you can quantify the cost of the system adoption, it may be worth investing in a billing hub system – Thomson Reuters has one. You load your data in one format and they distribute it to your clients in their desired format, through the client’s system of choice. But yes it is the cost of doing business, which should be considered when developing pricing.

Topic Expert
Karoline Mello
Title: Director, FP&A
Company: Apollo Group
(Director, FP&A, Apollo Group) |

Does your company have invoicing terms? Terms are commonly used to encourage payment, like 2% ten days / net 30 meaning the payer can discount the invoice subtotal 2% for paying within ten days. The payer pays the full invoice after. Could your company create payment terms like direct pay 2% / Ariba (or vendor of your choice) billing system net.


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