What is eProcurement and How Can it Help Solve Supply Chain Issues?
Electronic Procurement or eProcurement allows companies to automate their business processes and acquire the products, supplies, and services needed to run their business. By removing the need for cumbersome paper invoices or purchase orders, eProcurement offers more convenience and accountability, streamlining all parts of the buying process.
eProcurement is simple and knowing how this process works is quite advantageous to your business. Let’s take a look at what exactly eProcurement is, how it works, and what benefits it can offer your business.
eProcurement technology consists of a suite of innovative features designed to boost the productivity and effectiveness of procurement by consolidating and automating interactions between a business, consumers, and other value chain partners.
For instance, businesses can use eProcurement technology to automate manual operations like chasing a supplier for signing and emailing an agreement and analyzing yearly savings, which can result in substantial cost savings.
eProcurement is a business-to-business (B2B) process and, unlike eCommerce, it leverages a supplier’s closed system, which can only be accessed by registered users. One of the most significant component of eProcurement is vendor/supplier management, which involves both managing supplier information as well as supplier relationships. For instance, an eProcurement tool provides supplier onboarding questionnaires that help you collect data on several suppliers and create partnerships with your chosen providers.
How eProcurement Works
The eProcurement process starts with a purchase request that an authorized user can digitally approve. Once approved, the request automatically becomes a purchase order, which is then sent electronically to the supplier. The product or service is marked as “received” in the system once it is delivered, and an invoice is generated and sent to accounts payable for payment.
An eProcurement tool integrates spend analysis, eAuctions, procure-to-pay (P2P), eSourcing, marketplaces, and contract management. It improves the speed and ease of accounting with an automated invoice processing system.
Benefits of eProcurement
Digitizing your processes helps you avoid several manual steps while fast-tracking your workflow and decreasing potential errors. According to a Deloitte survey, digitization itself can decrease processing overheads by up to 70% in a business. However, these aren’t the only benefits eProcurement tools provide.
By adopting an eProcurement solution, an organization can experience a massive increase in its procurement compliance. Your business will gain a comprehensive understanding of the supply base objectives and become more supplier-focused. This will help you align suppliers’ decisions with your strategic requirements and improve transparency in your procurement system. Plus, it will help you control things such as non-compliant (or maverick) spending.
Adopting eProcurement technology also puts your business in a position to better negotiate goods and services at better prices from strategic suppliers. Moreover, consolidated transaction monitoring simplifies reporting on payments, orders, and requisitions along with guaranteeing agreement compliance, thereby accelerating delivery.
Here are a few more benefits of using an eProcurement tool:
Improved User Experience
- Standardize the buying experience
- Give employees and stakeholders a centralized platform to monitor and optimize procurement performance
- Streamline routine tasks so procurement teams can concentrate on strategic initiatives
- Optimize spend by reducing maverick spending
- Get discounts by combining orders and buying in volume
- Improve overall transaction speed
- Minimize fraudulent purchases
- Improve inventory management and control by quickly identifying goods from preferred vendors and limiting the number of purchases made
- Maintain safety against risk and supply chain disruption
Better Relationship Management
- Facilitate collaboration among several partners and stakeholders
- Negotiate more favorable contracts with strategic suppliers
- Reinforce supplier relationships
Ensure Seamless eProcurement with TestEquity
TestEquity’s eProcurement services offer a myriad of benefits for an organization’s everyday operations and supply chain activities. Our Techni-Tool solution helps decrease errors, frees up resources by automating operations, and simplifies the procurement cycle by enhancing communication between stakeholders and partners. Your team gets a consolidated platform to monitor and audit all procurement activities.
Techni-Tool provides B2B services and other programs to streamline ordering and inventory processes. We have numerous catalog capabilities, along with partnerships with many of the major B2B services like Supplier Gateway, Ariba, Exostar, Oracle Exchange, and more.
Techni-Tool provides vendors, managers, stakeholders, and partners with real-time updates along with the capability to organize and preserve procurement information. It also offers stakeholders and management a single point of contact.
Our eProcurement punchout catalogs ensure you receive products faster than ever, with 99.8% of in-stock products shipped the same day. With a huge collection of test and measurement solutions, we help you iterate new designs faster. Our largest inventory of electronics production supplies ensures that your production lines keep running.
Get in touch to learn more about how we can help you manage your inventory and budget more efficiently.