Taulia’s $1MM Dynamic Discounting Offer Raises A/P & Procurement Stakes

As a stand-alone capability, dynamic discounting often plays second fiddle to eProcurement and invoice automation/e-invoicing investments. Yet the dynamic discounting tools sector has been around for more than decade, dating back to the somewhat early days of req-to-pay technology. Often confined to treasury and accounts payable – and a limited sub-set of suppliers – most dynamic discount deployments rarely take advantage of existing procurement and supplier management investments and strategies, let alone broader procurement and finance collaboration.

Taulia is an upstart dynamic discounting vendor with tight linkages into SAP environments. They’re already changing the perception of dynamic discounting inside many organizations, some that already invested in first generation solutions such as Xign without the level of supplier adoption they had hoped for. For background on the sector and Taulia in particular, see recent coverage here:

Now, Taulia, once again, is stirring up the accounts payable, treasury and procurement pot with its latest offer: a guarantee of $1MM in dynamic discount savings capture in the first year of implementation.

Spend Matters believes that Taulia’s new guaranteed savings program is based on the measurable impact dynamic discounting can have. In contrast to "guaranteed" savings programs sometimes offered in category sourcing or procurement BPO areas, there is no disputing cost baselines, budget impact, or bottom-line results based on program returns.

This announcement will help showcase dynamic discounting’s potential to bring material savings for companies, calling attention to a cause that finance and procurement executives alike should come together more frequently on. Better visibility into liabilities, forecasting and overall AP efficiency is just the icing on the e-invoicing and discounting cake. Savings should come first and guaranteed programs will bring attention to the potential.

Specifically, according to Taulia’s offer, they “guarantee $1M in DD capture in first year, if this is not realized, client pays no additional fees until they hit the $1M savings mark.” The fine print is simple. Customers must:

  • Use Taulia e-Invoicing
  • Have over $3 billion in annual spend in scope
  • Adhere to TAULIA NOWTM best practices for supplier onboarding

Taulia also notes that “first year tracking on discounts begins at go live.” A reference customer we spoke to in 2012 (who has achieved some fairly remarkable results compared to the hard-dollar returns of most req-to-pay solutions over a 3-year period, let alone the first year) was able to implement the “portal and vendor invoicing components” of the Taulia solution in a 3-4 months with Taulia doing the heavy lifting for the implementation.

This organization was not new to e-invoicing and dynamic discounting. They had previously used Xign, but found numerous issues with the solution, including an inability to implement discount capture prior to the specified discount date/maturity (i.e., no “dynamic” option). This organization saw a “big advantage” through tightly embedding a discounting solution in the native SAP back-end and terms driven off of contracts (and the extrapolation of the “dynamic” component based on PO terms). Overall, how did Taulia stack up for this company? The project owner (with experience in IT, AP and procurement) suggested that “if you're running a single instance of SAP … the product is hard to beat.”

But perhaps the largest challenge facing Taulia (and the dynamic discounting market in general) isn’t just thriving in head-to-head product comparisons and selections. Rather, it’s convincing AP, treasury and procurement to come together to prioritize dynamic discounting initiatives as a priority, rather than as a second-wave eProcurement or e-invoicing initiative.

Hopefully Taulia’s latest marketing offer will do more than simply get it some attention – we suspect it will call attention to the massive hard-dollar returns that dynamic discounting can generate.

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