A consistent supply of goods is essential to enable frictionless business activities. To make this happen, you need a procurement system capable of handling all the complex procurement processes without needing manual assistance.
The world has been digitalized; your business can become irrelevant if you’re running obsolete or manual procurement processes.
With the current competition, all businesses want the best products; this makes procurement processes more complex. Without a cloud-based or automated procurement system, your business cannot stay ahead of the competition.
Automated systems will do all the heavy lifting for you and ensure your teams are provided with the right goods at the right time. So, what is a procurement system, and why should you automate it? If this is what's running through your mind, then dive into this blog to find all your answers.
Procurement is a term used by businesses when they purchase a product/goods to run their operation. A procurement system is the automation tool/platform used by the business for purchasing and inventory management processes.
Typically, a procurement system is used for the following:
Now that you know what a procurement system is, let's discuss why your business needs one:
The procurement team must thoroughly analyze the market and business requirements before creating the purchase order. The amount of budget allocated, the priority of the purchase, and other factors will influence the purchase orders.
Moreover, the team must meticulously review suitable vendors before submitting the Request for Proposal (RFP).
You can imagine how exhausting it can be to perform this process manually. A procurement system can eliminate this tedium by effectively managing all the requirements.
From selecting the right vendors based on the budget to inventory management, it saves time, increases the teams' productivity, and reduces expenses.
The products purchased by a business must adhere to procurement guidelines like product priority, budget availability, vendor requirements, etc.
Each business will have its own procurement guidelines. Compliance with these rules can be a daunting task for the procurement team as the team has to review them against the ever-changing regulations and rules.
With a procurement system, this task can be done in seconds; it will automatically flag discrepancies and sort out compliance alerts.
Maintaining a strong relationship with vendors is key for businesses to achieve long-term success. A vendor is equivalent to a business partner, so it is not a great practice to keep changing vendors for every purchase order.
You must also keep a close eye on your vendors and the products they deliver. It can be tedious to consistently keep track of vendors' performance and product quality manually.
This is where a cloud-based procurement system can be helpful by tracking vendor metrics and KPIs, which help increase engagement.
Purchase orders generate loads of information, which is essential for forecasting marketing trends and enhancing the purchase order process.
From the budget used, delivery time, and vendor details to intricate inventory data, all the information should be safely stored for future reference.
Managing all these data can be hard, and a single human error can mess up the entire process. This is where an automated procurement system can come in handy; it records all the necessary information in the cloud and displays it on an insightful dashboard when needed.
Now that you know why your business needs a procurement system, let’s discuss the benefits it brings to your business:
Time is essential in this competitive world. A procurement system comes with pre-built templates and automation workflows. These workflows will handle your procurement process with zero manual assistance.
From vendor selection to delivery tracking and inventory management, a procurement system will do all tasks by itself, saving your team's time.
Procurement is a long, cumbersome process; doing it manually is not only tedious but also makes it more susceptible to human errors.
A simple error might render the entire process obsolete and impact the buyer-vendor relationship. A procurement system, in turn, will carry out the entire process with impeccable accuracy and in no time.
Procurement is an intricate process involving multiple teams doing individual tasks to achieve the end goal.
Transparency will play a huge role in a process like this; every team should know what’s going on, or there will be bottlenecks and inaccuracies in case of a manual process.
A procurement system can eliminate these issues as it will gather all the data at every step of the process, which can be easily viewed by all the teams involved.
Procurement systems ensure the team stays within the procurement standards and that they follow all the necessary guidelines. It will also prevent them from purchasing products from unverified vendors, thus increasing product quality.
Procurement involves several repetitive manual operations that will reduce the organization's productivity.
Procurement software automates the entire procurement process, from sourcing to payment. The automation of repetitious procurement steps also allows for easier purchase management.
Purchase orders are legally binding contracts that must be devoid of flaws and irregularities.
Procurement software standardizes and improves the order management process, allowing irregularities to be recognized promptly. Orders are approved swiftly, thus making it easier to manage the purchase order process.
One of the biggest benefits of using a procurement system is that it helps you maintain a strong relationship with potential vendors through effective vendor management.
It is critical to qualify and evaluate a potential vendor's capability, compliance with business policies, and sustainability to guarantee that the vendor delivers better quality goods.
A procurement system improves vendor management by automatically assessing vendor trustworthiness and sending reminders when contracts are up for renewal.
What exactly should you look for in procurement software? Here is the list of essential features:
It's obvious, isn’t it? The first feature you must prioritize is automation. Nowadays, almost every procurement software is automated, which is the basic feature to look for.
A no-code builder is the next important feature in a procurement system. The system must let you build complex workflows easily without any coding knowledge. Even a complete beginner should be able to build workflows using the software.
Building an automation process from scratch is not an easy task. An ideal procurement system must have pre-built automation workflows to help save time and get started with the process quickly.
The pre-built workflows might need additional customization to suit individual business needs. A drag-and-drop workflow editor is a must-have for a procurement system to make it easier for the business to customize the workflows.
You might already be using company-built software or third-party apps for various business processes. So, you must choose a procurement system capable of integrating your in-house applications.
Ensure that the procurement system also has individual APIs to make the connection seamless.
A purchase order will require approvals from various department heads throughout the process. Individually asking for these will only cost you time; you can set pre-defined triggers that launch the process or give the green light to the next step when certain conditions are met.
Three-way matching compares the purchase order against the goods received note (GRN) and invoice. An ideal procurement system must have an automated three-way matching system for a seamless process.
You need to know what’s going on with your process and how it performs. KPIs should be tracked in real-time at every step of the process. So, you need a real-time platform that tracks all the performance metrics and KPIs. It must also have an insightful dashboard.
Self-hosting is a highly risky process, and in this digital world, speed and time are everything; you can get both with cloud-based storage. This makes it easier for the procurement team to get approvals at any time and location.
Your procurement system must be flexible and easily scalable for your business solutions, and all the features must be easily customizable based on business needs.
As the business continues to grow, the procurement system should also be able to scale with it and must be easily adaptable to the ever-changing market.
Hubler is a no-code, DIY platform that lets you easily create automation workflows to automate procurement processes and other repetitive tasks. It is also a business process automation platform that will perform all the heavy lifting and repetitive tasks for you while you can focus on running your core business.
Hubler’s Procure to Pay feature has all the essentials you need for a procurement system. You can easily automate complex procurement processes and stay ahead of the competition.
Budgeting, purchase requests and approvals, RFQs, POs, GRNs, and account payables can all be easily managed with Hubler. Provide your team with a consistent perspective of all of their processes.
Hubler's most helpful feature is its capacity to integrate with several systems simultaneously. Hubler can easily connect to your existing apps or databases. You can choose from a pre-defined selection of API keys or create your own connectors to fulfill your specific needs and enjoy smooth interactions.
Other important features of Hubler include:
If you’re looking for the ultimate procurement system, Hubler is a great option for you.