Organizations are quickly realizing that real-time data is the key to success. It can help enhance the customer experience and provide valuable insights for businesses. Real-time data can also transform a business’ purchasing experience, making it more efficient and more effective, and helping to reduce costs. Using e-procurement software, you can maximize productivity and minimize losses using data. Here’s how real-time data can be used to benefit your organization’s purchasing process.
With procurement management software, you can upload catalogs in one place so that you can compare prices and get the best bang for your buck. All you have to do is use the data that is punched in so that the software can comparison shop all of the options available from your network of suppliers. All of this information is then shown to you in one area. Your suppliers will not need to make any investments of their own to be connected to you. Also, your employees will no longer need to search through physical catalogs to price compare.
Real-time data can also integrate product descriptions and data from online search results. This data will give up to the minute price options so that you can compare recent prices without the need to contact your suppliers directly.
Real-time data can drive savings by securing the best deals for your business. It tracks your organization’s purchase history and supplies useful analytics to determine the competitiveness of current negotiated supplier pricing in comparison with competitors. This information is provided up to the minute in comprehensive reports so that you have actionable information that allows you to better negotiate with suppliers.
Discounted prices should be reflected at the time of purchase to make a well-negotiated contract. Your team works hard to negotiate agreements and terms with suppliers, but it is often challenging to ensure that they are compliant. Expensive and time-consuming audits are done to identify and recapture any transactional errors that may have occurred that are a breach of contract. This not only delays orders but requires manual interventions and reorders.
Real-time data lets users discover off-contract pricing and products before the process immediately so that you don’t pay for something that is wrong. You won’t need an expensive, drawn-out audit to discover discrepancies anymore.
When you have advanced, real-time capabilities, your sales channel becomes more attractive to suppliers. Your employees will be able to browse and search catalogs and websites much more easily and from one private marketplace. As user purchasing increases through that marketplace, the supplier sales will increase. This will lead to contract negotiations that benefit both your procurement process and the suppliers to create a truly mutually beneficial relationship that will drive cost savings.
Remember, your supplier relationship goes both ways. Your procurement process affects them, too. If your supplier ships an order and doesn’t receive payment, you will damage a crucial relationship. People in the same industry talk, so protecting your reputation is essential.
Compliance is another major factor when it comes to these relationships. Both parties must follow the terms in the contract. Data will help you determine whether or not you are complying with their terms to make sure the relationship isn’t one-sided.
By making your process more efficient with data, you can quickly and effectively manage the relationships that your success depends on.
Real-time price validation of items before an order transaction is complete will remove the potential order issues downstream in the procure to pay process. This will increase the speed of processing and reduce manual labor costs. Automation will take repetitive tasks and do them in real-time to help employees focus on more time-consuming tasks. The data is also used to reduce any human error that can happen when you are using manual processes. The wrong number can cost your business.
Your real-time purchase system will use prices from the catalogs and input them into PO’s for you so that you don’t run the risk of losing money.
Real-time data will allow you to refine your procurement process. If you are using manual methods, such as spreadsheets, you will see a drastic improvement across your operation. You will also be able to see analytics that show you which areas need improvement. You can first look at which part of the process takes the most time and find out why. Maybe the approval process is holding your business up. However, with real-time data, you can automate your approval process so that you’re not waiting for one busy person. Make sure to talk to everyone involved in the procurement process to find out which areas need improvement.
Once you have refined your process, make sure to share it with all of the employees involved in procurement so that they can change the way they do their job.
Let’s be honest. The most significant benefit your company will see is cost savings. Efficiency means that more work is getting done in a single workday, helping you save money each day you utilize real-time data.
You may think that using your cheaper, manual processes is the most inexpensive way to run your business. However, that simply isn’t true. Both free and more robust procurement software can help your employees save time and in turn, help your business save money.
SMBs can all benefit from e-procurement software no matter how robust it is because they simply automate your processes and increase your workflows to provide a simpler, more efficient purchasing experience.
The purchase department is responsible for acquiring goods and services. While that may seem simple enough, they actually have to perform a lot of tasks in between researching the best deals and making the purchase. If you’re an SMB, you know that your purchasing department does a lot, and it’s up to them to make smart purchasing decisions that impact the entire business.
Think of it like this, your purchasing department is responsible, at least in part, for the success of your business. You never want to waste money on purchasing products that you can get elsewhere, and it’s this department’s responsibility to make sure this doesn’t happen.
The answer to this question is simple: money. Improving this department and the way it functions can end up saving you tons of money each year. This includes saving on product costs and making your employees efficient enough that during their 8-hour workday, they are accomplishing more and making your business more profitable.
When you’re first starting out, it can be difficult to nail down the purchasing process so that everyone in the department is on the same page. However, using these tips, you can improve your purchasing department and positively impact your entire business.
Not every single person in the purchasing department needs to be responsible for calling suppliers and finding the best deals. Instead, you can put a team in place responsible for this task and allowing other members of the department to focus on the next stages.
You can also manage acquisitions systematically buy appointing one person to be in charge of calling suppliers and another for comparing prices. Whatever you choose to do, you must have a process that outlines the rules of buying so that everyone is doing it the same way and accomplishing each task.
To analyze spending, you will need to conduct a spending analysis. This analysis is a detailed review of how you spend, and it’s critical to review in order to improve the procurement system. Make sure to analyze each and every factor that affects the price of products, such as:
By improving this aspect of your purchasing department, you can save enough money for other areas of business, such as marketing, and hiring more employees as you grow.
To analyze demand, you’ll need to find out your company’s essential needs when it comes to purchasing. Only focus on the critical purchasing decisions that you make. In order to do this, you may have to rewrite internal policies that include new criteria that determine which products and services are essential.
You’ll also need to focus on quantity. If you’re buying in bulk for a lower price, consider how much it costs you to store items that you may not need for months to come.
You may want to consider buying cheaper goods from overseas. However, purchasing from foreign suppliers comes with costs that may make it not worth it, such as higher shipping costs. Since there are time differences as well, you can also expect a delay, so it’s not recommended that you use these suppliers for items that you need immediately.
You can simply buy more standard parts or goods from suppliers instead of the more expensive customized items. If this is possible for your business, talk to your suppliers to make sure the purchases fit your needs and that you’re not overspending on customized items. If you have a good relationship with your supplier, they should have no problem helping you cut costs, because you’ll continue to make purchases that benefit both your business and theirs.
Building partnerships is easy. However, building strategic partnerships may be difficult for some businesses. If you work with a lot of suppliers, you’ll want to start cutting down the list and try working with only a few.
If you work with fewer suppliers, you can save time and resources. You’ll also be able to build better relationships because you have fewer businesses to work with.
Your suppliers will feel honored as they have been chosen to be the few you do business with. This will help continue to build relationships so that you can expect more flexibility from them when it comes to your needs.
Always remember that your partnership should be mutually beneficial. You should be helping them succeed just as much as they are helping you. When you negotiate, keep in mind that you’ll have to help them see how both sides can benefit. This will help establish trust between you and them so that you can continue to be successful.
Once you have a smaller list of suppliers to work with, make sure to evaluate them regularly. You can establish your own system for assessing their performance, but make sure to include these factors:
Having a document available for your suppliers to review will also help them see where their performance can be improved, which can help your business and theirs as they have multiple buyers they deal with.
In the modern age, there are so many technological tools that can help your business grow and succeed. Your procurement process may have once been simple enough to warrant the use of a spreadsheet. However, as you grow, you’ll find more human errors and complications that make using manual processes impractical.
Many SMBs start out using QuickBooks to help them send purchase orders more quickly by creating a QuickBooks purchase order, which automatically fills in fields for you. While automation is key to success in the modern age, this program can’t do everything you need when it comes to procurement. Instead, users can integrate Bellwether with QuickBooks to:
Integrated procurement software will help you manage all of the day-to-day functions of the purchasing process so that you can save time and money while your employees focus on more important tasks, like building relationships with your suppliers.
For businesses who want to save significant time and money, robust purchase order software can help you manage vendor/ supplier relationships, find the best deals, and turn POs into invoices with a few clicks of the mouse. These technologies completely revolutionize the way you’ll handle purchasing, making everything from acquisitions to approval processes much more simple.
Being out of stock means that you don’t currently have any of a particular item available for purchase. This problem for business owners typically happens because someone in the purchasing department does not order enough inventory to satisfy customer demand.
Luckily, becoming out of stock can be prevented with purchase order software. Cloud-based inventory management systems let you easily track your inventory in real-time so that you know exactly what you have in stock and when you need to reorder products.
Let’s take a look at the consequences of running out of stock and see how e-procurement software can help you avoid them.
When you run out of stock, a customer can’t purchase it from you. If a customer can’t purchase from your business, you have lost a sale. If you have a huge demand for a product but run out of stock, you will lose multiple sales.
Ultimately, lost sales lead to lost customers. When someone visits your website and attempts to make a purchase that they can’t complete because you are out of stock, they will go somewhere else for a similar product. We live in a time where people want their e-commerce products delivered quickly. If you can’t deliver on that, they will take their money elsewhere, and potentially never come back.
Bad customer reviews
If you run out of stock, your customers will lose the trust they had for your business. You can also expect some negative reviews on your website or social media page. Word of mouth is one of the most tried-and-true marketing techniques because customers rely on one another’s opinions before making a purchase. This is especially true when it comes to e-commerce.
Declining business growth
When word of mouth spreads, particularly negative word of mouth, you can expect a decline in sales, which leads to a decline in growth. Customers will not want to purchase from someone with bad reviews, and the worse it gets, you can expect fewer and fewer customers.
Automation is key for preventing problems associated with being out of stock. Many businesses already use automated systems, which make the purchasing process easier and help to save time.
QuickBooks users can experience even greater efficiency and productivity when they integrate with Bellwether’s robust purchasing software.
Integrating e-procurement solutions with QuickBooks purchase order software will drastically improve all areas of the procurement function. Users can pull down these items into ePMX:
When integrated, users can enter invoices into ePMX, do a 3-way match with PO, receipt, and invoice, and bridge the invoices into QB for quick payment. All of these tasks save time and help the business run more smoothly.
In order to understand how a PO system can help you avoid out of stock solutions, we must first understand why businesses run out of stock.
Running out of stock is a problem many businesses face, especially if they don’t have a refined procurement process in place. Here are a few reasons why you may run out of stock.
In order to know what you have in stock and what you don’t so that you can make effective purchasing decisions, you’ll need to rely on data. Inaccurate data will always lead to poor purchasing decisions and cause your business some distress.
Product Ordering Gone Wrong
Inaccurate data will lead to ordering the wrong quantity of product. It may even lead you to order the wrong product altogether. If you don’t order enough product, you won’t keep up with demand, which means you will lose sales.
Your inaccurate data, which is the basis for the procurement process, must have come from somewhere. If you are using spreadsheets or a paper-based system, the odds are that human error is what leads to inaccurate data.
As you can see, the result of using manual purchasing processes can have a butterfly effect on your entire business. Procurement software can completely eliminate the risk of running out of stock and help keep your business successful and with happy customers.
Eliminate Manual Processes = Better Procurement
By eliminating spreadsheets, your purchasing process is no longer prone to human error. That means no more data inaccuracies that force you to make bad purchasing decisions. When this risk is mitigated, you can expect a smoother and more efficient purchasing function.
MRO inventory differs from traditional inventory because it lacks the same controls or practices. It is not typically measured in terms of inventory on hand or usage. Here are a few of the challenges of managing MRO inventory:
Purchase order software can help you do the following much easier, and in less time:
Track, Manage, and Control MRO inventory
To improve the MRO procurement process, you’ll need to track and manage your MRO inventory more effectively. Procurement solutions will help you more easily track items that can frequently get lost and lead to unnecessary spending.
Faster Purchase Requisition Approvals
When you need an item immediately, the process can get bogged down by the approval process. With cloud-based solutions, you can set certain criteria that allow MRO supplies to be purchased immediately.
Delivers Valuable Data
Predicting when you’ll need certain MRO items will help the entire procurement process run more smoothly. E-procurement solutions will give you easily digestible data that allows you to be proactive instead of reactive.
Reduce the Number of Suppliers You Work With
Tracking the performance of your suppliers may not be part of your procurement process. However, by determining which suppliers work best with your business, you can cut the number of suppliers you work with to improve regular business functions and improve relationships with them.
Purchasing software saves your employees time, which saves you money. Also, by reducing unnecessary spending, you’ll have more money to put into beneficial business tasks, like marketing and human resources.
By knowing which items you have and which you’ll need soon, you can reduce the immediacy of purchasing MRO supplies that are either in stock and lost or need to be replaced. This means cheaper delivery charges since you won’t need products the next day.
Purchase order system software will improve your entire business, helping you save and make more money each day.
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