Introduction
If you've landed here, it means you want to learn more about the meter-to-cash process and how the different Zero Friction entities communicate with each other.
Let's start with the definition: the meter-to-cash process is the process that describes how the consumption of energy, gas, water, etc. is converted into invoices that are sent to your end customer.
Easy, right?💡 We wanted to create an easy-to-use, intuitive solution that saves you time with countless Excel files and lets you focus on what matters most. 🚀
Now let's delve a little deeper into how the meter-to-cash process works. The first part we'll cover is the metering and consumption data📈.
Measurement and consumption data
Introduction
Zero Friction connects your chosen meter hardware via API, email, (S)FTP, or .csv import. We process the measurement data, convert it directly into consumption data, and then link it to the correct address.
After the meter readings are collected, the system validates the data for integrity and accuracy. Once the meter data is successfully saved, automatic consumption calculation is activated. After this, the meter reading and consumption can be visualized not only at the meter level, but also at the customer, address, and building level.
At least one measurement per day, up to a maximum of one measurement per hour, is processed, and the measurements are sent in the unit in which they are invoiced, including any correction factors. Finally, Zero Friction checks the measurement data weekly for irregularities.
The user-friendly dashboard provides you with an overview of individual consumption figures or total consumption per building at any time.
Furthermore, missing measurement data is immediately detected and identified. The Zero Friction platform guides you through the process and helps you quickly resolve issues, preventing errors in the invoicing process.
Flow
As a first step, you can configure the meters yourself using the configuration section, where you can specify the models and channels. Once a meter configuration has been entered, you can start adding meters using the predefined meter configuration.
Once the configuration from the configuration module is completed, you can activate the meter by installing it at a chosen address.
Once everything is configured and connected to the external meter data provider, Zero Friction will automatically receive meter data.
Service Location and Location Group
Introduction
After receiving the consumption and measurements in your Zero Friction account, this data needs to be linked to an address or multiple addresses. Before we introduce service locations or location groups, we'd like to briefly mention another part of this process: the customer. This can be a person or an organization, and our solution provides you with an overview of contracts, invoices, and payments, along with essential customer data.
Already have Customer Relationship Management (CRM) software? No worries, Zero Friction can connect to it.💡To learn more, please contact us at [email protected].
Now let's introduce the concept of service locations and location groups. A service location is a single, specific address where a service is provided to your end customer. A location group is a group of service locations that are more or less linked. This can be because they are located in the same building or because they are part of a single project (under development at a construction company) that has similar billing.
Explanation
When browsing a customer page, you'll notice how Zero Frictions groups a range of information on the same page. First, you can find your customer's personal information and bank details, and second, information like the customer's balance and transactions. This is also the easiest place to find contracts and invoices linked to the person.
To give you a clear overview of the service locations and location groups, you can navigate to the two modules on the left side of our platform. In the service location overview, you'll find the contract, which meters collect the readings, which services are provided at the address, and a tab with all consumption. Zero Friction creates a graph with historical readings to track the consumption values of the locations.
Contract and Product Management
Introduction
First, let's take a few steps back and summarize the previous points:
The meter collects consumption data, which is converted into measurements. This data goes into Zero Friction and is linked to a customer and a service location (a physical address). Now we need to link the customer, the service provided, and the associated consumption, as well as the products and prices for the connection you want to bill. A Zero Friction contract can do this.
Explanation
As an energy supplier, you have a contractual agreement with your customer. This contract consists of one or more costs that will be used in the meter-to-cash process. Products can have fixed costs or variable costs based on the energy consumed.
When browsing a contract in your Zero Friction account, you can find multiple interlinked pieces of information, such as the contractor (the end customer), the product you are supplying (with multiple invoice items translating into invoice lines), the invoice details (with the advance payment frequency and the invoice frequency), and the service location.
When you move a customer to a service location, you have the option to create a new contract. You can select the customer you're moving (you can choose between an existing or a new one), the service location, and finally, the contract requirements. The required fields are the contract reference, a start date and (optionally) an end date, the product to be invoiced, the invoice frequency and advance payment frequency, and finally, the advance payment amount.
For a product, we define which services are charged for creating the invoice. You can select the billing items based on various billing calculation types. You also have the option to structure your rates based on whether your costs are fixed, tiered, volume-based, or formula-based in each of the rates. It's also possible to add different tax codes or cost components with time-sliced values.
Billing
Introduction
Our meter-to-cash process extends to invoicing, specifically how invoices are generated in Zero Friction. Billing processes are customizable to your corporate identity, and customers receive invoices based on your product and rate structure, featuring your company's look and feel (primary and secondary colors, and your company logo). When meter readings are received regularly, invoices are generated in draft status, ready for your approval. We support not only invoices or final bills (issued upon contract termination), but also advance payments, incidental and corrective bills, and credit notes.
Explanation
When you navigate to the invoice module, you have a clear overview of invoices awaiting approval, invoices yet to be sent, invoices ready to be sent, and finally, invoices that have not yet been paid. In addition, the following invoices can be generated: advance payments, statements, final statements, incidentals, and credit notes. Invoices are generated automatically by Zero Friction, providing all necessary data. Meter readings, rates, and prices must be configured for the billing period. If any of this information is missing, the system cannot automatically generate the invoice, requiring manual intervention. Invoices are generated at the end of the billing period (monthly, quarterly, semi-annually, or annually). If a user needs to correct an invoice due to incorrect prices or meter readings, they must delete the previously generated invoice and manually create a new one.
Here's a brief explanation of the accrual mechanism. Invoices are generated based on the contract's billing period, which can range from monthly to annual. Advance payments can be made monthly, quarterly, semi-annually, or not at all. After the billing period ends, the system generates an invoice, which is adjusted for any advance payments made during the period. If no advance payments have been made, they are credited but still outstanding, resulting in a higher invoice amount. The final note for a contract is the final invoice for its end. It includes all billing items from the last invoice date to the contract's end date. If there was no prior invoice, it covers the entire contract term. Advance payments made during the contract period are deducted from the total invoice amount on the final invoice. Unpaid advance payments made during the contract period are credited and not deducted from the invoice amount on the final invoice.
Collecting invoices
Introduction
And finally... The end of the meter-to-cash process: collecting the money. 🚀 After approval, the invoice is ready to be collected via direct debit or bank transfer with an outgoing bank transaction. By processing the incoming bank statements, Zero Friction always has insight into the customer's balance. Customers with overdue invoices will receive reminders by setting up a dunning cycle, and if any outstanding invoices remain unpaid, additional costs may be charged. Within the platform, the customer aging report provides an overview of your end users' total outstanding debt.
Configuration
Newly sent invoices generate an outstanding debt for customers. If these are not paid correctly, the collection cycle begins. At this point, the end customer, if configured, will already have received a friendly reminder and can view the document that will be sent to them, which will be available on their incoming bank statements.
Our platform has already linked the payment to the relevant customer, based on their bank account and the message provided. After processing the information, the invoice will now be paid, completing the collection cycle.
In short: as a Zero Friction user (not your end customers), you can send an invoice using your company identity with the rates and products you've configured. Your end customer has received a direct debit or bank transfer request, and unpaid invoices have been flagged with a reminder. Thanks to the dunning cycle, payments were processed and paid out correctly.