Heather Reid, Director of Education Canada and Accounting Insights at 8th & Walton, joined us to discuss the critical importance of supplier invoices matching purchase orders.
Lainie: Heather, when it comes to supplier invoices and purchase orders, what does Walmart mean by a perfect match? And why does this matter so much for timely payment?
Heather: It’s a great question, Lainie, and it has to do with the fact that if your invoice does not match a purchase order and a receiving, there are going to be delays in payment. That purchase order and invoice need to mirror each other. If there are any differences, the system does not know enough to do an auto-match and it puts the invoice into a research mode.
Lainie: That does not sound good.
Heather: No, it is not a good thing because that means a person has to get involved to reconcile and work the invoice and try to match it up. What we really want to happen is for the system to do all the work for us from both the Walmart side and the supplier side.
Lainie: You were talking about how they do not mirror each other and that this can delay payment. You get a person involved and that makes things even more difficult. So what are the kinds of things that suppliers should be doing before invoicing to make sure they are going to have that perfect match?
Heather: The first thing you want to do is, when that purchase order comes in, make sure you agree to the terms and check whether anything is wrong with the costs or quantities. Anything with incorrect UPC codes needs to be fixed before you do anything related to shipping. There are applications within Retail Link that suppliers can use to request a change to a purchase order if it is incorrect. One of those is NOVA, and another is in Supplier One under Orders in the menu on the left-hand side. So you want to make sure you get that purchase order corrected before you even submit an invoice.
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Lainie: Now, when despite everyone taking precautions and trying to do things right, the invoice ends up in a manual review, what steps can suppliers take to get the payments back on track?
Heather: We really want to find out what the root cause is. Why did it not match? Was it a receiving problem? It could be, and sometimes that is out of our control.
But if it is something that we did not include on our invoice, we want to go back, look at the purchase order, and compare it to the invoice. Are we missing an allowance that we were supposed to give to Walmart?
Sometimes the invoice is not structured in the same way line by line, so the lines do not actually line up. Line one on the purchase order needs to be line one on the invoice to get that mirror effect. If there are still issues after that, we need to reach out to Walmart and ask what else we can do. After we have done everything we can on our end, the goal is to find out how to ensure that payment runs through in an automated and smooth way.
3-Minute Insights is produced by 8th & Walton at The Ledger in Bentonville Square. The Ledger offers six fully bikeable stories of private offices, individual coworking spaces, meeting rooms, and event venues. The Ledger’s stunning views and state-of-the-art amenities make it the perfect location for doing business, hosting events, and celebrating life’s milestones, including weddings!
