An insight into e-procurement: Understanding the definition and process for successful procurement
E-procurement (also known as eProcurement) is short for electronic procurement and refers to the digital purchasing of goods and services by companies. This process involves the use of technologies that promote and digitalise the purchasing department.
What is e-procurement? An introduction to the electronic procurement process
E-procurement (also known as eProcurement) is short for electronic procurement and refers to the digital purchasing of goods and services by companies. This process involves the use of technologies that promote and digitalise the purchasing department. The administration of procurement processes takes place over so-called e-procurement systems which optimise procurement strategies and aid in the achievement of procurement goals.
Specifically, e-procurement is a crucial element of Procurement 4.0, an innovative approach that employs digital solutions and technologies in the procurement process to enhance efficiency, accuracy, agility, and compliance. With the help of e-procurement systems, procurement processes are simplified and optimised through digital platforms. This fosters interactive collaboration among all parties involved in a supply chain. E-procurement systems ensure automated, cross-company networking along the entire supply chain, from start to finish.
What does the e-procurement process look like?
E-procurement can seamlessly integrate with the entire procurement process, covering all stages from sourcing and purchase management to spend analytics. This ensures that the entire purchasing process is comprehensively covered.
Requirements
To begin the procurement process, the first step is to establish the requirements. This involves identifying the necessary goods or services, determining the required quantity, quality standards, delivery timeframes, and any other pertinent information. With e-procurement, these requirements can be quickly and easily defined using digital systems. This provides the buyer with a clear and efficient overview of their list of requirements, allowing them to keep track of requests throughout the process.
Supplier management
E-procurement systems aid in the supplier selection process. They provide support in supplier analysis, evaluation, and qualification, facilitating the search for the best possible option that aligns with the procurer’s requirements and strategy. This helps to ensure that the right supplier is selected for their requirements and strategy.
Contract management
Once potential suppliers have been identified, the next step is to negotiate prices, terms, and conditions. E-procurement creates a platform for communication and easy exchange between all parties involved. Buyers and suppliers can start discussions and easily pass on the most important information to each other via the system.
Procurement
As the item and the supplier have been selected, the next step is placing the order. Electronic procurement automates the ordering workflow. Orders can be created, approved, and monitored electronically so that the process is under constant supervision.
Payment
E-procurement simplifies the payment process by incorporating automated payment procedures that reduce the manual workload. With the aid of Robotic Accounting, a smart algorithm, invoices can be swiftly captured, processed, and approved, freeing up time for accounting professionals to focus on more strategic activities. This streamlined process reduces the need for manual intervention, allowing repetitive tasks to be completed without human interaction. Overall, e-procurement helps to streamline and optimize the payment process, making it more efficient and effective.
Spend analytics
E-procurement systems enable companies to collect and analyse data on their procurement process. This enables procurers to gain valuable insights into their purchasing process, which includes a comprehensive analysis of expenditures, supplier allocation, and material groups. A final analysis ensures that the procurement strategy is developed and improved from start to finish. E-procurement takes care of every single area of procurement – so a fully automated process creates efficiency by saving time and money at every turn!
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