The Benefits of E-Procurement

By automating and streamlining the procurement process, corporate purchasing buyers can focus on more strategic activities that result in:

• Increasing the productivity of purchasing

  agents, providing them with more non-routine time and reducing job pressures; possibly reducing purchasing departments’ overhead.

• Lowering purchase per item prices through activities such as product standardization, reverse auctions, volume discounts, and consolidation of purchases from fewer suppliers.
• Improving information flow and its control (e.g., price comparisons).
• Reducing the frequency and cost of maverick buying.
• Improving the payment process, and sellers’ savings due to expedited payment cycle.
• Establishing more efficient and collaborative partner relations due to information sharing.
• Improving the manufacturing process for the suppliers.
• Ensuring delivery on time, and fewer stock-outs.
• Reducing the skill requirements and training

  needs of purchasing agents.

• Reducing the number of suppliers.
• Streamlining and expediting the purchasing

  process.

• Controlling inventories more effectively at the

  buyers’ end.

• Streamlining invoice reconciliation and dispute resolution.
• Reducing the administrative processing cost per order by as much as 90% by reducing purchasing overheads and intermediary fees.
• Finding new suppliers that can provide goods and services faster and/or less expensively (e.g., by going global and use online price

  comparisons).

• Integrating budgetary controls into the procurement process (e.g., ariba.com).

• Minimizing human errors in the buying or shipping processes.

Source :

Efraim Turban, David King, Jae Kyu Lee, Ting-Peng Liang, Deborrah C. Turban (2015), Electronic Commerce A Managerial and Social Networks Perspective