Everything you need to know about e-Procurement
Electronic procurement, or e-Procurement, is a method of supplier exchange that focuses on the sale and purchase of goods and services, primarily through a networked system, or a web-based platform. It is a commonly used B2B, and in some cases, B2C process that helps businesses procure goods from vendors.
E-Procurement is defined as a digitized transaction process that involves companies using connected interfaces to buy or sell goods and services.
The technology makes it easy for businesses to streamline all transactions and automate interactions between vendors and other partners throughout the value chain. With the help of electronic procurement, companies can introduce greater speed and efficiency throughout their procurement department.
E-Procurement software generally contains an array of different features that are designed to improve the effectiveness and efficiency of procurement departments.
The precursor to e-Procurement was actually the electronic data interchange (EDI), which was first released in the 1980s. With the help of EDI, users could freely exchange and share files or other documentation online. It greatly boosted the speed at which companies were able to conduct business, as businesses no longer had to rely on physically sending documents to complete transactions.
This allowed vendors and buyers to transmit purchase orders or invoices more efficiently. Eventually, email and e-Procurement technologies took over, making it easy for businesses to quickly send electronic purchase orders, receive confirmations, and invoices from vendors.
Instead of having to manually carry out repetitive and laborious tasks related to procurement, e-Procurement automates the entire process. AP and procurement teams no longer have to worry about exchanging supplier contracts or getting suppliers to fill out onboarding questionnaires.
Instead, through an e-Procurement portal, employees now have the technology to quickly search through digital catalogs and choose what they want to buy. They can also manage purchases based on purchases.
The process of e-Procurement is predicated on bringing several vendors together on a single platform. Most e-Procurement software also offers vendor management features, letting them manage and maintain their own profiles.
Most e-Procurement solutions offer several key features, such as:
E-Procurement offers a variety of benefits, some of which are discussed below.
With e-Procurement software, companies can manage vendor relationships through a centralized platform. Vendors can maintain their profiles, and orders can be processed quickly and efficiently. Instead of having to work with paper-based processing, e-Procurement software greatly streamlines and automates different procurement processes.
Shorter procurement cycles mean that companies are able to receive goods much quicker after placing an order. Since orders are only placed with qualified vendors through established processes, the time it takes once a purchase order is sent till the goods are received is shortened considerably.
Companies can save significant sums of money by using e-Procurement software. It helps eliminate costly errors that could occur as a result of manual recording and paperwork. This money could be reinvested into streamlining other business processes.
Companies can define limits and establish greater control over spending, since only authorized individuals are able to place orders. This reduces needless maverick spending which doesn’t fall in line with the company’s procurement policies.
E-Procurement software makes it easy for organizations, especially procurement teams, to analyze the company’s purchasing behavior. This allows the company to better prepare for an uptick in seasonal demand, reducing the risks of overstocking or understocking, and figuring out areas for consolidating suppliers.
This can help companies leverage their buying power to negotiate favorable terms and prices, and also reduce associated costs with procurement.
SoftCo e-Procurement is an industry-leading e-Procurement solution designed to help businesses streamline their purchasing process for all operational, capital, and recurring spend. It offers an intuitive catalog and vendor punch-out solution, and you can define requisition approval workflows to accelerate the order process too.
Above all, the solution offers powerful dashboards that can help companies reduce their costs, manage risk, and evaluate vendor performance in greater detail. It offers a catalog solution that’s similar to marketplaces like Amazon, and comes pre-loaded with items! Book your demo today!