eProcurement is the action of buying and selling goods and services through the Internet. It is different from e-commerce as it helps in using the supplier’s closed system, commonly available only for registered users.
A properly implemented E-procurement system unlocks the communication lines between a company and a supplier by establishing a direct link and helps in interactions such as bids/auctions, purchase orders, and emails.
What is E-procurement software?
E-procurement software is the enterprise setup that automatizes and unites the scope of an organization’s procurement cycle. A perfect system of eprocurement software can enhance the visibility of spending and approval affairs.
If we take it as an example, we can say that online sourcing as part of an E-procurement process helps customers seek catalogs, add stuff into the shopping cart, and issue requisition. Although, automation of online procurement surpasses the experience of online shopping. Online procurement contains many actions, functions, and workflows, which makes E-procurement quick and economical. The E-procurement policy eliminates most document work from the procurement team, focusing on other high-value tasks.
An efficient E-procurement policy focuses the procurement procedures and gives visible cost-saving results. Indeed, the E-procurement program offers different features and options. Some of them are suitable for large organizations, while others are less difficult and suitable for small or medium-sized enterprises.
Must-have features of eProcurement software
A lot of choices are prevailing in the market for E-procurement software. Different systems offer different features in terms of their areas of expertise or suitability to different sizes and kinds of business. Nevertheless, several features are necessary to the successful operations of eProcurement software. Hence, an organization should prioritize a sourcing software solution that provides these features, as a minimum:
- Capable of Powerful reporting to examine the performance and ensure compliance across the scope of procurement management.
- A range of well-developed yet customized workflows and template documents help the organization fully automate the procurement process’s monotonous areas while sticking to standard policies, regulations, and legal compliance.
- Enhance supplier management options so that the sourcing team can trace and examine vendor execution, easily get onboard new vendors, and cooperate in real-time with vendors simultaneously to reduce errors or problems.
- Automation of three-way matching ensures that only approved purchases are reimbursed, and original spending is eliminated.
- Presence of tools to help the procurement managers in setting and publicizing budgetary controls all over the purchasing cycle to avert fraud and costly errors.
- The ability to produce online product archives can be managed and updated on the spot, offering authorization to diminish employee workload and error percentage.
Advantages of using eProcurement software
If the organizations acknowledge the tangible advantages of applying and using an eProcurement software system, here are some of the most noticeable benefits it can get:
Effectiveness and efficiency
Using an eProcurement solution, a company can pinpoint poor-performing suppliers as soon as the process starts, which can eventually create problems like higher cost or production problems. It is due to the procurement software has inbuilt reporting functions to trace and differentiate supplier performance in a range of metrics, spotlight problematic areas, and on-time analysis.
Tracing spending on purchases in contrast to budget is much more smoothened and straightforward with eProcurement software. It helps provide better facts and figures to the procurement team to clarify the reasoned procurement decisions based on contrasts between vendors and factual spending data.
Decrease errors and inefficiencies:
Errors and inconsistencies related to purchasing data can be costly in terms of time and money and can reduce the efficiency of the overall procurement process. An e-sourcing solution provides more organized and consistent workflows with less human involvement, which diminishes the error rate and enhances the quality of procurement particulars.
By keeping that in mind, it’s crucial to understand the organization’s unique features and requirements while selecting a solution and undertake a full analysis of the needs of the business before assessing the market for software providers. E-sourcing implementation reduces manual errors and paper-based functions due to acute automation and visibility of purchasing procedures.