Thursday, July 7, 2022

6 Reasons To Embrace E-Procurement

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Procurement is an integral part of all kinds of businesses. From start-ups to established companies, businesses of every size and every industry need to purchase certain services and goods to roundup their sales cycle effectively. The process of selecting vendors, negotiating prices, signing contracts, and finally acquiring the services or goods from the external sources is known as procurement. In order to remain competitive in their respective domains or industries, more and more companies are placing emphasis on automating their procurement operations. There is more than one reason behind this growing tendency to automate procurement operations via e-procurement systems. Here are the 6 main reasons to adopt e-procurement for your business:

Reduce Expenses

E-procurement can help you save costs. However big or small your business may be, there is always the risk of duplicate spending, resources getting drained in keeping track of multiple vendors and contracts, and manual errors creeping up in the paperwork. E-procurement helps you to do away with all these and more. You can reduce your costs by eliminating duplicate spending, reducing external spending through system improvements, keeping track of every vendor effortlessly, and leveraging volume purchasing through the use of an e-procurement system. Further, you can reduce your expenses related to paperwork, minimize the risk of errors, and eliminate the need for rework.

Increase Visibility And Transparency

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One of the advantages of e-procurement solutions is that they centralize transaction tracking. This means you can have easy access to order-purchase details and can get confirmation of the transactions. Access and visibility of data are very important in business. When you opt for e-procurement, there will be greater transparency in every aspect. The e-procurement system will provide complete reports on requisitions, goods purchased, orders processed, and payments distributed. It will be easier for you to access and analyze reports related to procurement. Additionally, e-procurement minimizes the risk of data manipulation. So, you will be in a better position to ensure that the procurement operations are not manipulated in any way.   

Improve Efficiency

More often than not, the bottlenecks in procurement procedures result from manual handling of the operations. For instance, the purchase order approval procedure often takes a lot of time in several business organizations. Sometimes the procedure can be a long-drawn one and may need uploading of documents, sending of emails with attachments, downloading of those emails and documents, printing the documents, signing them, scanning them, attaching them, and emailing them back. Such cumbersome processes can be streamlined through automation. E-procurement can help you to eliminate the bottlenecks and improve efficiency in the procurement operations. In other words, you or your staff will save time spent in such operations and can use that time productively in doing other important works.

Eliminate Paperwork

A traditional procurement system involves a lot of paperwork. As your business grows, you will have to keep on finding new spaces to accommodate all the paperwork that result from the procurement operations. There is another big issue associated with this scenario. If you need to access any old tender or purchase order, you will have to spend some time to find out the required document from the old files. With an e-procurement system, you can eliminate the need for paperwork completely. As everything gets done electronically and in a paperless method, you won’t have to bother about finding space to store the documents physically. Also, it will be quite easy for you or your staff to get hold of any old document instantly through the automated system.

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Exercise Control

When you have a standardized approval procedure and proper workflows, you will be able to ensure that each transaction has the right authorization. This will also mean that the money spent is aimed to fulfill existing contracts. Another advantage of automating your procurement operations is that you can make sure your procurement staff complies with your buying policies. If anyone on your procurement team fails to adhere to the set principles or guidelines of purchasing in your company, it won’t escape notice. You can quickly locate if products or services are being procured from non-preferred suppliers and vendors. Thanks to e-procurement, you can even draw a line to maverick purchases.

Standardize Purchases

It is not that procurement decisions are always made by a single department. When more than one department is involved in this task, there can be differences in opinion as well as in how and what purchases are being made. E-procurement makes it easier for everyone to conform to the set standards when making purchase decisions.  

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Sara Revonia
Sara Revonia
Entrepreneur, Speaker, Author, and Mom. Sara Revonia’s articles are about business, life, and Entrepreneurship.
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