B2B transactions run into the trillions of dollars each year. Yet, remarkably, more than 60 percent of those payments—about $30 trillion, are made primarily by check, according to the Federal Reserve Banks of Minneapolis & Chicago. Nearly one-quarter make and receive B2B payments mainly by Automated Clearing House (ACH) while only three percent make and receive B2B payments mainly by card.
On Wednesday morning, the second day of Ariba Live 2013 in Washington, D.C., Ariba announced its partnership with Discover to bring an end to that cumbersome practice. “Buyers are drowning in paper and sellers have no idea when, or how much, they’ll be paid,” said Ariba President Kevin Costello. AribaPay, expected to be available in 2014, is designed to ease that pain.
The cloud-based service will leverage applications and insights within the Ariba Network to streamline and enhance settlement and reconciliation of business commerce. The payments will be made through Discover’s global payments infrastructure. It will allow buyers to create purchase orders, receive invoices and send payments, while sellers receive more-detailed remittance information.
“Ariba and Discover are seizing the opportunity digitize a share of the estimated $30 trillion in B2B payments that are still mostly made with paper checks,” Discover President and COO Roger Hochschild told the more than 2,000 attendees at the Gaylord National Resort & Conference Center in Washington, D.C. “Discover is broadening its network capabilities and infrastructure and choosing diverse business partners like Ariba to move beyond facilitating payments to enabling and improving business commerce.”
Attendees were told that the new alliance will lead to lower processing costs, richer remittance advice, reduced fraud risk, elimination of paper checks and invoices, fewer payments lost to escheatment, ability to track and trace transactions, and faster reconciliation and dispute resolution.
Ariba Spot Buy
Koozoo is a Bay-area startup that provides an app that turns old smart phones into continuously broadcasting video cameras. With no existing supplier database, it had to find potential suppliers so they could get enough phones to properly test the app on all platforms and smart phones. “We had no existing supplier database, and had to go through a time-intensive manual process of finding potential suppliers,” explained Ian Thomson, Koozoo’s Director of Business Development. “LinkedIn was ineffective and tedious, Alibaba—suppliers failed to understand our requirements, on Amazon and eBay it was hard-to-find enough devices and a Google search was laborious and ineffective.” Koozoo also needed to design and manufacture a small number of suction-cup mounts for the cameras.
By using Spot Buy on the Ariba Discover Network, Koozoo Created six RFPs, received 10 bids each, and found five new suppliers. One supplier was able to deliver a custom-made mount in a tight timeframe, Thomason explained, as he took the mount from the inside pocket of his jacket. “The solution cost was cut from $17 to $1 per unit.”
Lifetime Achievement Award
Another highlight of the annual conference is the presentation of the Lifetime Achievement Award. This year’s award was presented to Leslie Campbell, the retired CPO of Reed-Elsevier. In accepting the honor from Ariba’s Tim Minahan, she gave some tips on leadership.
- “Be courageous and take risks.”
- “Be inspired.”
- “Be generous with your time and your expertise.”
And for success in your business, she summed up, “Learn to listen and respond.”
The conference closed with an address by Steve Forbes, Chairman and Editor-in-Chief of Forbes Media.
For more on the conference, visit www.Ariba.com.
