KPI Benchmarks : Percentage of Invoices Paid On-Time
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KPI Details : Percentage of Invoices Paid On-Time
Percentage of Invoices Paid On-Time measures the number of invoices paid before, or on the date listed within the terms of the invoice/contract as a percentage of the number of invoices paid by the Accounts Payable (AP) Department over the same period of time. A relatively low value for this metric is typically related to a few common factors including highly manual (i.e., error and rework prone) or inefficient invoice processing processes, cumbersome or unclear vendor invoice submission guidelines, and sub-par AP Department employee training and performance. Each of these factors can lead to increased vendor dissatisfaction which can reduce the likelihood of cost reduction or avoidance through sound vendor relationship management.
KPI Best Practices : Percentage of Invoices Paid On-Time
KPI Calculation Instructions Percentage of Invoices Paid On-Time?
KPI Formula :
Invoices Processed per Employee
The total number of invoices processed (i.e., received, input and paid/pended/denied, or scheduled for payment) over a certain period of time divided by the total number of Accounts Payable...
KPI Type : Productivity
Formula : Number of Invoices Processed and Paid to Vendors / Average Number of AP Employees
KPI Benchmark Range : 389 - 2,300
Vendor Payment Error Rate
The number of outgoing payments processed by the Accounts Payable Department that contained an error (e.g., wrong address, incorrect amount, duplicate payment, etc.) divided by the total num...
KPI Type : Quality
Formula : (Number of Payments to Vendors Containing Errors / Total Number of Payments to Vendors) *100
KPI Benchmark Range : 1.4% - 2.9%
Vendor Payment Processing Cycle Time
The number of business days required to process an invoice from a company supplier, or vendor, from when the invoice is received by the Accounts Payable Department until it is approved and s...
KPI Type : Service
Formula : (Sum of Vendor Payment Cycle Times) / Number of Vendor Payments Approved and Scheduled to Pay
KPI Benchmark Range : 3.5-11.8