E-Procurement is a quickly growing market that sends dollar signs into the minds of business owners. Most people realize the benefits of using the Internet for business transactions, but less realize the benefits of e-procurement. Fortunately, more and more people are realizing the benefits of procuring goods online. Perhaps the most important aspect of any business is the bottom line. E-Procurement is highly effective in improving a business’s bottom line. Perhaps the most impressive benefit of E-Procurement is the amount of money saved during the entire purchasing process.
Quite simply, e-procurement is the term used when goods are purchased for a business electronically. There are three stages of E-procurement: identifying suppliers through e-procurement, placing of orders, and the e-procurement arrival notification. When all of these e-procurement steps are implemented online by automation, the cash begins to fall into place. More and more businesses are realizing the amazing benefits of e-procurement, while others still lag behind. It won’t be long before all businesses use e-procurement, but not before precious money is wasted on the traditional systems.
Traditional companies do procurement by hand and by hard paper copy. This takes up a lot of time, energy, and paperwork any business would gladly take back. Extra time and extra paper processing mean extra money spent. However, companies that use e-procurement have been shown to reduce their costs by up to 85%. This is a huge number when talking about time, energy, and the money e-procurement saves.
Some businesses may wonder about the initial cost of investment in an e-procurement system. The initial cost of an e-procurement system is virtually irrelevant. In fact, in a mere 3 years, experienced e-procurement firms estimate returns of 300% of the initial investment. Any company looking at the big picture can see the return possibilities of e-procurement. What’s more, e-procurement can benefit a wide spectrum of industries, so everyone in almost every industry wins with e-procurement.
E-procurement is usually used for frequent, inexpensive purchases such as office supplies. Currently, larger purchases are still conducted by traditional procurement means. Using non-e-procurement procedures, supply chains can be extremely wasteful. E-procurement takes care of this supply chain problem by simplifying the entire process. This improves the whole manufacturing cycle while control of inventory improves as well. This way a company knows exactly what they need when it will need it, and how much it will be receiving. There is no guesswork involved with e-procurement.
Efficiency is another benefit of E-procurement. When your company is efficient, you save money. This is because there is less time and less energy spent doing something that could be done with less effort. E-procurement is that vehicle in which to use less effort to accomplish your procurement tasks.
E-procurement is just another step e-commerce has made in the business world. E-procurement can benefit just about every business in any industry. You do not need to have a website or be Internet savvy. E-procurement is just an electronic way to handle your paper processing needs online. Most companies can see the benefits of e-procurement. The only next step is to take those e-procurement realizations and implement them into action.