[This article was written by Samantha Wallace.]
The two most common platforms that people within any company will come across are e-commerce platforms and procurement platforms.
Many people are very familiar and comfortable with e-commerce platforms such as Shopify or Magento.
Procurement platforms are a little different and can make some executives a little uneasy. Procurement is a delicate process that is often entrusted to one person or a small team of department heads. So, entrusting any part of this process to a software solution can be difficult.
Expectations of a Procurement Platform
You should expect a procurement platform to provide fully functional modules that work interdependently. They should provide the following functions:
- Purchase order creation
- Invoice approval
- Purchase requisitions
- Vendor management
- Contract management
These five key factors in procurement are exhaustive for anyone one person or even a small team to handle on their own. eProcurement platforms are stepping in and helping to alleviate some of the workloads.
Creating purchase orders can cost a company hundreds of dollars per purchase order in administrative costs alone. Many companies have opted for a software solution to aid in creating purchase orders, but an eProcurement system can entirely automate the process.
Many companies hold onto manual invoice approvals in the hopes of mitigating risk, overspending, and poor vendor relationships. The issue is that this bottlenecks the procurement process on an unbelievable scale. Large spreadsheets and exhaustive data entry processes for invoice input are unnecessary. eProcurement solutions can offer to track an invoice and even tie an involve to a vendor for vendor reputation management.
The major area where a procurement platform should deliver is in purchase requisitions. Organizations usually get left with an overcomplicated hierarchy. Even when companies have a procurement agent, purchase requisition will often come from multiple departments and multiple levels and hardly ever on-time.
eProcurement systems aim to restrict purchase requisition to reduce delays or inconsistencies in the process. It almost forces staff to adhere to the restrictions of the software.
A procurement platform can resolve issues with communication and approval, as well. The approval process is a massive bottleneck for many companies, and it’s easy to see why. Executives don’t want procurement agents to have limitless authority when it comes to making purchases.
Additionally, small businesses that don’t use procurement agents might require that every purchase goes through the owner for approval. Working with a platform, you can submit requests from lower levels, and the approval authority can mark a request as “approved.”
Punchout Catalog Options
If you’re a large organization with a difficult procurement process, you should consider using a punchout catalog. Punchout catalogs come in two different levels with the second level provides the best of both worlds – manual entries and automation.
When operating as a seller using the punchout catalog protocol, you can expand your business and customer base with only the addition of an eProcurement system.
Working as a punchout catalog vendor, you can provide users with a succinct experience that will keep them coming back repeatedly. All the while, you’re able to introduce new products and promote other products through separate pages.
Punchout catalogs are not new to procurement processes, but eProcurement platform solutions are making it easier for mid-level companies to use these methods as well.
As a seller, you can integrate eProcurement systems into your site to allow customers to create a shopping cart and then process that car through another, external, system. For buyers using punchout catalogs can work as a solution to reduce maverick spending.
Finding A Good Fit
eProcurement solutions are still developing, and they’re a relatively new solution. It may be difficult to find one solution that provides everything you need in your procurement process on a scale that also matches your business.
A company may want to focus on one or two aspects of its procurement process when selecting the right software solutions for them. Additionally, many eProcurement platforms are meant for giant corporations. Platforms will often fit a specific industry or match your ideal buyer.
Consider whether your procurement officer is working most often as a middle man or a direct buyer. Then identify what size your company fits under the platform’s definition. The platform host may consider a small company as having less than 500 staff. Finally, consider whether you’re looking for a platform to use solely as a method of tracking or for communication as well.
Samantha Wallace is a veteran tech writer and editor who has worked in several eCommerce companies. She has been covering technology online for over five years. She is the Content Advocate for Greenwingtechnology.com.