Online procurement, also known as e-procurement, is the process of buying and selling goods and services over the internet. It streamlines tasks for purchasing agents, includes resource planning tools, cost comparison software, tracking capabilities, and helps companies adjust order volume.
Also known as electronic procurement or e-procurement, online procurement is the process of ordering and selling goods and services over the Internet. This type of ordering can be accomplished using a vendor-established branded login page for a specific customer, or via a vendor-created general ordering site. The main purpose of online procurement is to speed up the placement, processing and delivery of orders for goods and services.
There are several types of online procurement in use today. Some have to do with preparing to place orders, while others are focused on placing the orders itself. With each of these applications, the idea is to streamline the tasks usually handled by purchasing agents, allowing them to conduct searches and place orders in less time.
For customers, online procurement systems usually include features known as resource planning tools. These tools make it easy to identify what you need, create requisitions for those items, and generate purchase orders once you’ve identified a supplier for those goods or services. Software of this type helps streamline the internal processes used by many companies to qualify vendors and set up regular orders of needed items based on usage.
Complementary tools to the online procurement process include software that helps identify potential new suppliers. This tool can help you perform cost comparisons with existing suppliers to see if the same type and quality of goods and services can be obtained at a more competitive cost per unit. Software of this type usually includes tools that allow you to query potential suppliers about prices on various goods based on volume purchases.
Another component found in many Internet-based shopping capture systems is the tracking capability. This allows customers to see when an order has been received and determine if it is currently in process or has been fulfilled and is now en route. It is not uncommon for procurement schedules of this type to include an expected delivery date, based on the current status of the order. This handy tool can eliminate the need for purchasing agents to make frequent phone calls to suppliers to find out how the order is progressing and when it is reasonable to expect delivery.
From a supplier perspective, the use of online sourcing strategies makes it easier to receive and initiate order processing in a more timely manner. At the same time, helper features that allow customers to see the current order status mean less time spent tracking down information for customers. This allows the seller to focus more on order preparation and on the road.
The efficiency of online shopping has changed the way many companies do business. Customers can adjust their order volume to keep raw material inventories small, which in turn means less taxes to pay. Suppliers can process multiple orders at the same time which helps in increasing business volume. With some services, online procurement means instant delivery with services such as teleconferencing, long distance, and electronic materials such as e-books.
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