Globalization has consistently reduced the age long stress we previously experienced in carrying out our business transactions over the years. E-procurement is an online business to business (B2B) purchase and sale of supplies and services over the internet.
E-procurement software such as; SAP, Ariba etc makes it possible to automate business transactions.
Little wonder, most blue chip organizations and conglomerates that have implemented e-procurement systems have been able to control inventory more effectively and reduce purchasing agent overhead. E-procurement is also otherwise referred to as supplier exchange;
Typically, e-procurement websites allow qualified and registered users to look for buyers or sellers of goods or services, depending on the approach. Buyers or sellers may specify prices or invite through bids.
In other words, Transactions can be initiated and completed without moving an inch from where the business is initiated and completed. It is worthy of note that, ongoing purchases may qualify customers for volume discounts or special offers as the case may be.
E-procurement platform over the years has made bid, selection supply to be highly transparent, automated, easy tracking system revised mechanism and interactive. Suffice to say that e-procurement which offers a lot more advantages than traditional form or mode of procurement involves automated purchasing systems using software applications that are “web” or internet-based. For example a web browser can log into an e-procurement system to view vendor offerings, catalogues, procedures, specifications and place orders or select a bid. This confirms the fact that e-procurement is definitely a step above the open market place or shopping mall activities, commonly found on the internet. An e-procurement network typically uses sophisticated technology that provides a secure sales platform and transaction tracking system available only to selected buyers and suppliers.
This unified e-procurement platform is centered around spend analysis, purchasing, savings, pipeline tracking, supplier management, sourcing, contract management e.t.c this really makes it a powerful robust and tool for the competitive 21st century challenges. It is noteworthy that advantages of using e-procurement includes process efficiencies, cost reduction, time saver, visibility of spend, refined controls, compliance, technology; driven these are observed to be functional and fully integrated for overall success of the companies.
Though, e-procurement provides significant bottom line benefits, cost savings, increased productivity, implementation has been a major challenge while acceptance 21st century by users and managers. With volume of global transactions which occurs everyday across diverse sectors; the advantage of e-procurement cannot be over emphasized in efficient, timely, accessible and interactive business climate. There is no gainsaying the fact that “the world is flat” as posted by Thomas L. Fr iedman.
With the advert of internet, which has given rise to e-procurement businesses can now be transacted without being hampered by physical location any longer. A good example of International Oil Companies that have visible footprints in Nigeria that uses e-procurement tools are Chevron, Total E&P, Shell, ExxonMobil e.t.c.