eProcurement can be of enormous value to companies of all types, and particularly to manufacturing companies. eProcurement provides numerous benefits to companies that employ this strategy, including the reduction of costs, the elimination of paperwork, as well as reduced manual labor and errors. eProcurement, when fully implemented in all departments, can also lead to a total visibility of spend, which leads to the ability to conduct spend analysis and to manage spend as well.
When conducting eProcurement, it is possible to obtain items from a catalogue of approved items, making the procurement process very streamlined and efficient. When conducting eProcurement, time is saved such that staff can work on high value transactions, and can concentrate on strategic sourcing and on improving supplier relationships. In short, eProcurement can be of enormous benefit to your company. In this article, we outline the various ways that eProcurement can lead to reduced cost, increased efficiency, and overall strength for your company.
An enormous benefit of eProcurement is the ability to allocate indirect materials from a catalog or from a purchase requisition to a shopping basket. You can then see all account information and at the same time transfer the same information directly to the supplier. The ultimate goal of an eProcurement solution is a total Procure to Pay (P2P) process that supports electronic procurement from placing the order to settling the bill. Good eProcurement solutions are either available for full integration with your ERP or can operate independently as a standalone Procurement solution.
There are numerous inefficiencies within the traditional procurement system that get fixed with an eProcurement solution. It is important to note that organizations and companies of all sizes benefit from eProcurement. Oftentimes there is poor compliance with corporate contacts, leading to unnecessary administrative overhead and payment costs. Additionally, the risk is much higher of ordering unapproved or nonexistent item. When using an eProcurement solution, these risks and inefficiencies are removed.
Additionally, without eProcurement your orders suffer from a higher error rate and a longer purchase cycle time, specifically due to the multi-stage nature of existing procurement processes. Your organization or company may have complicated or time-wasting logistics and approval procedures as well as fulfillment procedures. eProcurement simplifies and speeds up the process of managing and dealing with purchase orders, invoices and delivered goods.
eProcurement is undoubtedly a way that businesses can use to procure goods with greater ease and importantly, transparency. Businesses conducting indirect procurement (literally every company from a regional business to an international enterprise) ought to be using some form of eProcurement solution in order to cut costs and red tape, and improve compliance while reducing error rates.
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