PROACTIS Resources

Screwfix

Screwfix nails down costs with PROACTIS AP Managed Service
Screwfix
 
 

Background

Established over 30 years ago as a family run business and a part of Kingfisher plc since 1999, Screwfix Direct (Screwfix) turns over in excess of £500 million and continues to grow. It is the UK’s largest direct supplier of tools, accessories and hardware to tradesmen, maintenance and repair organisations, and serious DIY enthusiasts. The company’s headcount is over 5,000 with staff employed in the trade counter division, with the remainder in head office, contact centre and distribution centre operations. Alongside the next-day delivery service for items ordered by telephone and online, Screwfix continues to roll out trade counters. These outlets are stocking the full range of products supplied for immediate collection.

Challenge

Rolling out a network of trade counters without ramping up back-office costs was a challenge for Screwfix.

In line with expansion, the 132,000 invoices received each year into the business continued to grow at a rapid pace. This growth was resulting in substantial process inefficiencies through lost and misplaced invoices and lengthy invoice approval and document retrieval, in addition to lowering employee moral within the Finance department.

“We quickly realised that to meet the demands that invoice processing was placing upon the Finance department we would need to add significantly to headcount,” notes Richard Shoteh, Finance Systems Manager. “Rather than just increase headcount to cope, we wanted a better way of capturing and approving invoices. We also wanted to eliminate other types of paper handling and to make cost savings and productivity gains.”

The Process

Screwfix evaluated both onsite and outsourced document management suppliers, and electronic data interchange (EDI) suppliers. It included in its statement of requirement the ability to handle electronic invoices for those of its suppliers already geared up for that. Its ultimate aim was to take just one feed of data into its systems, irrespective of how suppliers chose to invoice. PROACTIS was invited to go through a lengthy exercise of understanding, at the end of which it recommended an outsourced invoice processing and document management solution. This had capabilities to introduce electronic handling of invoices as a future phase. PROACTIS was also able to bring to the party a history of working closely with CODA to provide integrated solutions.

“PROACTIS showed us proven levels of innovation and integration with our CODA finance system and introduced us to a number of companies who were very happy with the combined solution.”

The Solution

The Screwfix implementation required an innovative response to a number of challenges, not least in integrating an outsourced offering with onsite systems. This was achieved by creating an exporter from the PROACTIS Managed Service and an importer into the onsite CODA system, with the internet securely transferring invoice information from PROACTIS to the Screwfix Direct head office. Once invoices were scanned, all the relevant information would be captured, either through automated invoice data capture or through the manual keying of invoice information by the outsourced solution personnel.

To achieve this, PROACTIS gained a thorough understanding of the values that were keyed and how exceptions were dealt with. For example, rather than simply rejecting invoices that lacked all the correct values and asking suppliers to resend the paper invoice with complete information, PROACTIS created a web-based exception handler. This allowed Screwfix to correct invoices with missing values, and process them more rapidly.

Looking Forward

Such has been the success of the project that PROACTIS is now working on further inefficiencies within Screwfix’s processes, including archiving trade account application forms and matching stock invoices to goods received notes (GRN) from warehouses. “The ability to validate and automatically match invoices at line level to GRNs will be a huge benefit for the business and will significantly save our teams time,” comments Paul Roy.

As for the company’s goal of processing paper and heterogeneous file formats, Screwfix is finding that its suppliers are moving to electronic processing but are all operating slightly different file formats.

“It’s almost impossible to impose a single electronic system and get all your suppliers to conform. Working with PROACTIS, we will eventually take in paper and electronic files in any format, then match them to GRN feeds at line level,” concludes Paul Roy.

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