Often Shepherd subscribers use subcontractors for the service that they perform for their customers. In many cases, those subcontractors are small businesses or even sole proprietors who are notorious for doing their accounting only when they themselves need the cash. Unsurprisingly, this often means that Shepherd subscribers receive several waves of bills from their subcontracts near the holidays.
At first glance this boon to cash flow may seem just that. Stop and think about it, however, and you begin to understand just how difficult such cost reporting will make it to run a large and even a medium sized business. Large multinationals, for example, will often write framework agreements for services that Shepherd subscribers then execute. One of the more punitive aspects of these contracts is that Shepherd subscribers must submit their invoices along with proof of any associated cost within a short period of time after service completion. You have probably already identified the issue: when a subcontractor submits their bills so late Shepherd subscribers must delay invoicing their own customers and perhaps even lose the right to do so.
Preempting slow billing by vendors
For this reason, Shepherd has enhanced its Time & Material processing feature to automate vendor and subcontractor billing on both an hourly and a piecemeal basis. The hourly variant of these features will calculate your vendor’s billing according to the labor rates defined for specific services for that vendor. NetSuite does allow vendors and subcontractors to report time in NetSuite using the Shepherd mobile application. The configuration is easy and using it supports reports and billing automation all throughout NetSuite.
Choosing how to bill
The piecemeal variant of the feature calculates billing not per hour or minute but by quantity, for example the area of flooring installed. Assign to each vendor their own piecemeal price and Shepherd will calculate what is due to that vendor upon time and material processing.
In both the hourly and the piecemeal variants, the automatic output may be a Purchase Order or a Bill depending on your preference. Shepherd recommends either a Purchase Order or a Bill in unapproved status. Shepherd subscribers often then give their own vendors a window to approve or challenge this billing, which they may do through email advice or by logging into the NetSuite Vendor Center.
No longer dependent on others’ admin
Whether the motivation is to allocate cost to the right period quickly or to improve your own accounts receivable for customers who demand proof of cost, automated vendor billing grants you better control over your business. If you want to use Shepherd to avoid being victim or other people’s accounting, contact us to learn more.