The procurement process involves sourcing and finding required goods and services and then making agreements to acquire them from an external source. The procurement process can be short and simple or it can be long and complex depending on the industry an organization is in and its scale of operations. For instance, international and manufacturing businesses may need to source and procure the supplies they need across the border, which adds a layer of complexity to the procurement process. That is where effective e-Sourcing technology comes in.
Streamlining the Procurement Process
The advantage of e-Sourcing technology is that it streamlines the procurement process. A best in class e-Sourcing solution, such as offered by ProcurePort, leverages global strategic sourcing expertise and advanced procurement technology to provide results most organizations don’t even know they can achieve.
Six Benefits of Technology-Driven Procurement
By utilizing technology-driven procurement strategies and processes, you’ll experience these benefits:
1. Cost Savings
One of the greatest benefits of an optimized procurement process is reduced costs and significant savings. By procuring from those offering the most competitive prices, your profit margin will increase. Additional cost savings are achieved from the process efficiency derived with the implementation of e-Sourcing technology.
2. Optimal Supplier Selection
Advanced e-Sourcing technology allows more suppliers to participate and to be evaluated and ranked. Reverse auction technology is a great example of a sourcing platform that broadens the scope of available suppliers while at the same time making it easier to select the most cost-effective source. Another benefit will be finding supplies of the best quality. For instance, if you are a textile manufacturer or fashion designer, you could find the best cotton in India or Egypt which would result in improved product quality.
3. More Efficient
The procurement cycle has several key steps that are cyclical. When an entire organization understands and uses the same processes, there is more efficiency. Corporate branches located across borders will have the same, high-quality end product. It will also ensure that qualities and services are available when and where customers need them.
4. Improved Collaboration with Internal and External Stakeholders
Furthermore, an optimized procurement process ensures that an organization is in a position to collaborate with stakeholders. Such things as natural disasters, shortages, economic downturns, and political volatility that could disrupt the supply chain are able to be dealt with swiftly. Effective collaboration with suppliers and other stakeholders allows provisions to be made for such incidents and the ability to reach into the network to procure items from a network of suppliers.
5. Better Decisions Based on Analytics and Business Intelligence
Utilizing an eRFX module allows buyers to carry out basic or more involved supplier surveys and to collect quotes or prices from them. This can be for a handful of items or for several thousand. When they get the requests, suppliers respond by simply filling in the line price of each item via an online web interface.
In addition, those procuring items can grade responses and rank buyers by their price. This kind of analytics and business intelligence makes the procurement process shorter and more efficient because it is based on real-time supplier prices. For those who source and procure through auctions, ProcurePort has a reverse auction module that can be used to increase competition between suppliers using various sourcing strategies, depending on the goods or services being procured.
6. Improved Negotiation
Real-time data on prices, availability and response times allows procurement managers to better prepare for negotiations. You will also be able to find sources that offer extras like quantity discounts and warranties.
Optimizing the Procurement Process with e-Sourcing Technology
Technology has changed the way organizations source goods and services. Leading organizations use technology to find the solutions that directly contribute to their bottom line. Effective e-sourcing solutions do just that. By reducing costs, saving time, and providing deep-level data, the ROI of such solutions is easy to determine.
According to an article published by Supply Chain Quarterly, a number of leading companies have adopted certain best practices. One of them is making use of technology at different points in the procurement process. Many companies just select procurement software and believe that it will automatically streamline and optimize their processes, but it doesn’t.
The ProcurePort approach makes the best of technology at three points.
Spend Analysis Software + Service
With Spend Analysis software and services, ProcurePort makes use of automation and human intellect to provide organizations with spend categories that are accurate, data that is comprehensive and clear visibility into purchasing trends.
A Strategic Sourcing Suite
ProcurePort makes it possible for an organization to realize cost savings and shorten sourcing cycle time. This is done by leveraging a comprehensive e-sourcing toolkit which utilizes procurement processes that result in more favorable supplier agreements.
ProcurePort does not just throw the word simplicity around. The ease of use of the software ensures organizations realize user adoption and cut off runaway purchases. This is done through ProcurePort’s P2P Software. ProcurePort provides clients with a complete set of tools they can use to streamline all of the procurement processes from sourcing to making payments to suppliers. The suite is cloud hosted, easy to implement, and user-friendly.
The best approach is to first review the process your organization has in place to identify the areas that need to be improved. Software selection should then be done to suit these needs. Many organizations purchase software then try to figure out how it can work for them. It should be the other way around.
ProcurePort is a leader in providing cloud hosted e-procurement and strategic sourcing solutions. Our consulting services and flexible deployment options enable organizations across a range of industries to improve spend management, automate processes, and achieve procurement excellence.
If you’re ready to turn your procurement processes around, contact ProcurePort to schedule a consultation. We’ll discuss your requirements and help you determine if our e-sourcing solutions are right for your organization.