Last edited 27 Jul 2020

E-procurement

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'E-procurement' refers to tendering processes carried out online and through information and networking systems. It can be a highly-effective way of managing complex supply chains with multiple tiers of suppliers.

Very broadly, e-procurement might include:

  • E-informing: the process of gathering and distributing procurement information both from and to internal and external parties.
  • E-tendering: the process of tendering using online technology.
  • E-auctioning: web-based software that allows potential suppliers to compete online, in real time, to provide prices for the goods/services under auction.
  • Vendor management: an application that acts as a mechanism for business to manage and procure staffing services.
  • Catalogue management: the process of suppliers enabling product content to be made available to buying organisations in order for them to procure goods electronically.
  • Order status: the ability to track orders online until delivery.
  • Advance ship notice: notification of pending deliveries.
  • E-invoicing: exchange of the invoice document between a supplier and a buyer in an integrated electronic format.
  • E-payment: the e-payment system facilitates the acceptance of electronic payment for online transactions.

E-procurement software automates procurement-related functions, procedures and processes, reducing the need for paper-based and human processes. E-procurement platforms can usually be customised according to the needs of the user, often with accessibility through smartphones and tablet devices. It frees up an organisation’s procurement teams from low-value tasks, allowing them to focus on higher-value activities such as contract negotiation.

There are several potential challenges for an organisation implementing e-procurement. These involve considerations such as the installation and integration of software with other enterprise systems, training requirements, and liaising with suppliers to ensure a successful transition to the new system. However, there are some significant benefits that can be achieved. These include:

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