What is eProcurement? Benefits & Types

So, unsurprisingly, it requires significant time, effort and organisation to manage each stage of the procurement process, including requesting proposals from prospective suppliers, awarding contracts and managing the resulting supplier relationships.

One way businesses are navigating these challenges is by digitalising the process – combining all of these elements into a single eProcurement solution and benefiting from the automation and collaborative potential of the platform.

But what exactly is eProcurement? And how does it differ from traditional processes? DeepStream explains all…

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What is eProcurement? 

eProcurement is the name given to the fully digitalised procurement process that uses technology and software to automate and streamline the sourcing of potential suppliers and the purchasing of goods or services.

It involves the digital exchange of information and transactions between buyers and suppliers, eliminating paper-based processes and manual interventions.

eProcurement encompasses various activities such as supplier identification, sourcing, requisitioning, ordering, invoicing and payment – and typically involves the use of software applications, online platforms and electronic catalogues to facilitate the entire procurement cycle.

The growing popularity of eProcurement – compared with traditional processes – is a result of the efficiency, reduced costs, enhanced transparency and effortless supplier management that comes with a fully digital process that is traceable and auditable on a single platform.

Who is eProcurement for? 

eProcurement offers a wide range of benefits to all parties engaged in the procurement process, from purchasing departments to finance teams and other stakeholders involved in sourcing, contract management and supplier management.

The principles and technologies adopted in the eProcurement process are common across many industries, including government agencies and educational institutions, manufacturing and construction firms and retail.

The tools cater to both buyers and suppliers, providing support and functionalities to streamline collaboration, improve efficiency and enhance visibility for both sides of the procurement process.

This makes it a valuable tool in the strategic procurement process – providing transparency and collaboration in a single software platform.

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What are the Benefits of eProcurement? 

eProcurement offers several benefits compared with traditional offline, paper-based processes. These include:

Cost Savings

‍eProcurement helps companies reduce costs by streamlining the various manual procurement processes into a single intuitive platform.

Process Efficiency

‍eProcurement automates and digitises procurement processes, reducing the time and effort required for tasks such as supplier identification, requisitioning, ordering and invoicing.

Enhanced Visibility

‍eProcurement provides greater visibility over spending patterns, supplier performance and contract compliance.

Improved Supplier Management

‍eProcurement software facilitates improved supplier management by providing tools for supplier selection, performance tracking and collaboration.

Increased Compliance‍

eProcurement platforms can enforce compliance with procurement policies and regulations, ensuring all purchases, communications, bids, contracts and more are logged and traceable within a single solution.

Strategic Insights

‍Access to data and analytics enables companies to gain strategic insights into their procurement operations.

Sustainability and CSR

‍eProcurement can support sustainability and corporate social responsibility (CSR) initiatives by helping companies track and source from eco-conscious suppliers, monitor ethical practices and promote sustainable procurement practices.

Enhanced Collaboration

‍eProcurement platforms facilitate collaboration between procurement teams, stakeholders and suppliers, enabling real-time communication, document sharing and streamlined workflows.

Types of eProcurement Software 

There are various types of e-procurement software and tools – often available in a combined solution – designed to cater to the different steps involved in the sourcing of goods and management of supplier relationships.

These popular tools include:

eSourcing Software

‍Helps streamline the sourcing process by automating tasks such as supplier identification, request for proposal (RFP) creation, bid management and supplier evaluation.

eProcurement Suites

‍Comprehensive software solutions that cover the end-to-end procurement process, including requisitioning, open tendering, purchasing, supplier management, contract management and invoice processing.

eContract Management Software

‍Facilitates the creation, management and tracking of contracts with suppliers to help automate contract workflows, ensure compliance and provide visibility into contract terms and obligations.

Supplier Relationship Management (SRM) Software

‍Focuses on managing relationships with suppliers, including performance tracking, collaboration and supplier performance evaluation.

eProcurement Marketplace Platforms

‍Online platforms designed to connect buyers and suppliers, allowing for efficient sourcing and purchasing of goods and services from multiple suppliers.

eInvoicing and Payment Software

‍Streamlines the invoice and payment process by automating invoice capture, validation and approval, as well as facilitating electronic payment methods.

Analytics and Reporting Software

‍Provides data analysis and reporting capabilities, offering insights into procurement performance, spending patterns, supplier performance and other key metrics.

DeepStream’s eProcurement software digitally transforms your procurement processes – enabling you to save time, reduce spend and transact with confidence.

Simplify the procurement process by centralising every element – from bid invites to supplier selection, contracts and supplier communications – in a single intuitive, fully auditable platform.

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Frequently Asked Questions (FAQs)

Q: What is the difference between procurement and eProcurement? 

A: The difference between procurement and eProcurement comes in how the two processes are executed. Procurement refers to the wider process of acquiring goods and services, while eProcurement specifically refers to the use of electronic systems and technology to streamline and automate these procurement activities.

Q: What is the difference between eProcurement and purchasing 

A: eProcurement refers to the wider strategic process that encompasses the sourcing, selection and acquisition of goods and services from suppliers, while purchasing is a subset of procurement that specifically focuses on the transactional activities of buying goods and services from suppliers.

Q: What is the role of eProcurement in supply chain management?

A: The role of eProcurement in supply chain management involves automating and streamlining the sourcing of suppliers, the purchasing of goods, and the ongoing communication, collaboration and evaluation of supplier relationships.

Q: What is an example of eProcurement?

A: An example of eProcurement is a company using a single digital platform to execute the complete procurement process – from managing requests for proposals (RFPs) and allowing suppliers to submit bids online, to supporting supplier selection, contract management and ongoing communications with the successful supplier.

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