When Electronic Data Interchange (EDI) came into existence in the 1980s, it allowed standard business transactions that used to be completed using paper, over the phone or by mail to be accomplished electronically. Out of this game-changing technology, eProcurement, or electronic procurement, was born. If you are considering whether to use an eProcurement system, this post may help inform your decision.
What is an eProcurement system?
eProcurement is a business-to-business process of acquiring goods and services electronically. Because an eProcurement system is only available to registered users, it’s not considered eCommerce, but it is similar. An eProcurement system connects customers (internal or external) with suppliers through electronic means such as a website.
What is the eProcurement process?
The eProcurement process includes everything from planning and selecting vendors to developing the ordering system to creating invoicing and payment functionality. Different eProcurement platforms may be used throughout the system, and some platforms may cover multiple parts of the process. They may even “talk” to each other through custom APIs. The eProcurement process includes:
- eInforming. This planning step involves sharing distribution information internally and externally and usually happens in an Enterprise Resource Planning (ERP) system because it takes place before purchasing.
- Vendor administration. Choosing and managing vendors for various needs is an integral part of eProcurement. Procurement and Supply Chain managers will often select vendors that can meet multiple needs for streamlining purposes.
- Catalog administration and eOrdering. The online catalog and ordering options ensure end users are aware of product availability and get a consistent product.
- eInvoicing, and ePayment. With everything else online, invoicing and payment options are included in the eProcurement process.
What are some types of eProcurement?
Some examples of eProcurement include:
- A franchise that wants franchisees to have consistent marketing materials uses an eProcurement system so that all locations have the same branded materials that are specific to their site.
- A healthcare system has many statewide affiliates providing patients access to health services through an allied network of hospitals and community health centers. eProcurement allows them to organize and share their corporate printed materials in one convenient online location.
- A manufacturer uses a lot of printed items, from parking tags to labeling forms, all of which need to be available to multiple departments. An eProcurement system allows for a customized online ordering system.
- A fraternity has many promotional/branded items, including new member welcome kits available for many locations across the United States. An eProcurement system allows specific users to purchase the fraternity’s items online.
What are the advantages of eProcurement?
There are both advantages and disadvantages of eProcurement. Benefits of eProcurement include:
- Streamlined ordering with all marketing materials and company products available for ordering in one place
- Convenient access through web-based technology that allows 24/7 ordering
- Consistent brand management across company locations, franchises, etc.
- Control which products are available to which end users
- Improved visibility with real-time, on-demand reporting
- Ability to create marketing materials with variable data capabilities
- Customized workflows and customizable approval processes so that the right individuals can be notified and approve purchases when a location makes an order for materials or promo products
- Quicker ordering, fulfillment, and delivery to stakeholders
- Reduced staff costs
- Lower inventory costs
Challenges of eProcurement
The challenges of eProcurement depend on an organization’s needs and the eProcurement platform’s perceived user-friendliness. Four questions to ask when considering eProcurement systems are:
- Can it integrate with existing ERP and procurement systems?
- Is it easy to use? Does it have a user-friendly interface that incorporates a familiar shopping experience to popular eCommerce sites?
- Is it configurable and customizable to my organization’s unique processes?
- Does the platform provider have training and support capabilities that meet the needs of the users?
- Will the provider help ease implementation, and how long will it take?
eProcurement Software Checklist
Here are some core features of Fineline’s own eProcurement system, Finelink, that you might look for in an eProcurement system:
- Document editor, including variable data capabilities
- Asset library (digital asset management)
- Design collaboration tools
- Content design and editing tools allowing for variable data by branch
- Custom and automated reports on product utilization, inventory, cost centers, and more
- Order tracking
- Create user groups and custom permissions
- Approval workflows
- Inventory management and fulfillment
- Custom ERP, CRM, and procurement integrations
- Promo codes and gift cards
An eProcurement system can be game-changing for organizations of many types and sizes. If you need help solving complex problems with your printed materials’ procurement, check out Finelink or contact us for more information.