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eInvoicing in Denmark: At the cutting edge of fast growth
28.11.2005 (elma) eInvoicing is in a challenging position in Denmark at the moment. The public sector has accepted only electronic invoices since February. However, there are several standards in use in the Danish market. It is therefore up to the suppliers and vendors to drive development in electronic invoicing.
At the moment, there is a vigorous debate in the Danish business community about electronic invoicing. This is because the Danish government has decided to adopt a standard, called OIOXML (public information online extensible mark-up language), for invoicing to all public offices, companies are investigating the possibility of using this or similar standards in the business-to-business environment.
Since February, all invoices to the public sector have been sent electronically. In all, 18 million invoices will be exchanged and 440,000 companies are affected by this decision. Two thirds of all invoices to the public sector are totalling electronic, and the rest are converted into e-invoices by scanning.
Political decision behind e-invoicing
"The decision of going over to e-invoices was purely political," says Kim Høgskilde, Managing Director of Itella Denmark.
"Those companies which are suppliers to the public sector have not been particularly positive about the decision. Many of these companies think that the deadlines for the changeover were too tight. Besides, companies do not gain anything from the decision - only the public sector makes savings."
Several standards are used in Denmark. The public sector uses OIOXML. PBS (the banks’ payments system) uses another standard, and EDI is also in use.
E-invoicing is not yet that common in Denmark. However, companies are getting more and more interested in communicating electronically.
"It is mainly the business-to-business companies that are looking for e-invoicing solutions", Høgskilde underlines.
"In general I think Danish companies are rather positive towards e-invoicing, or doing business electronically – to achieve savings and process efficiencies" Businesses driving development
The business-to-consumers sector is also picking up, driven mainly by companies’ desire to save money and time. But since there is no universal standard in Denmark that everybody can rely on, it is up to businesses and vendors to drive development.
According to Høgskilde, Itella’s market share is growing. "We see potential customers in the financial sector as well as the wholesale sector. There is also potential in manufacturing companies."
Competition is not yet intense, but Høgskilde underlines that companies are getting prepared.
"Right now we are a part of the environment that is setting the standards. It takes an enormous effort today, but it is crucial to take up the challenge now if we want to position ourselves in the market," Høgskilde points out.
"If we do it right, we will be considered one of the main players and we will be part of setting both the price and the standards for modern electronic communication in Denmark."
Broad portfolio an advantage
The Elma business model and the entire Itella value proposition are highly competitive in Denmark.
"Our main advantage is that we can use the power of our broad service portfolio. In Denmark we see this as a differentiating factor. We are able to use the ability to print and deliver invoices electronically as the differentiator, because not that many of our competitors can do this."