According to IDC, in 2018, the global market for procurement solutions grew by 12.3% to $ 5.1 billion. In addition, manufacturers of these solutions are expanding their capabilities to automate and integrate with popular third-party virtual data rooms. Here is more about it.
Digitalization of procurement: how much a company can save on digitization?
Procurement management is the company’s purchase of goods and services to ensure its production process. It should be noted that procurement management is a rather complex process for the company. Before managing procurement, you need to study the market, looking for the best suppliers. You need to know the quality and price conditions of goods and services purchased to do this. Then the negotiation process is carried out, and the relevant procurement management procedures are followed. Managing a company’s procurement is crucial to achieving a successful result.
While the business is not in a hurry to automate this segment, in the current environment, management understands well what is needed for investment in marketing, production, sales, etc. – all that moves the company forward. But procurement stands aside for a variety of reasons. For example, they are not tied to the main KPIs, or the person in charge of procurement is at the second level of subordination and is not a member of the board of directors. Therefore, it is not obvious to management how much the optimization of the direction would affect other indicators.
At the same time, companies in the corporate segment of the market have switched to new tools and appreciated their benefits. It is an opportunity to save, access to more suppliers, regardless of the size and location of the business, the way to build new supply chains, minimize the risks associated with contractors, and more. The more suppliers – the more opportunities the solution opens up to its users.
Virtual data room for procurement
Today, virtual data room is a program that consists of various modules aimed at monitoring, accounting, and analysis of all business processes of the enterprise. The basis of the software is database management, which stores information about the company’s finances, production, personnel, etc.
Procurement management in the data room software provides the following opportunities:
identification of suppliers;
determination of procurement conditions;
support for various schemes for receiving goods from the supplier;
different ways of forming orders and control over their execution;
adjustment of orders to suppliers, closing of orders;
registration of deliveries;
formation of schedules of deliveries of the goods and schedules of payments;
adjustment of deliveries and return to suppliers.
Data room functionalities from the https://www.dashtech.org/document-sharing-and-data-management-solutions-to-get-your-business-started/ review include:
Operational procurement planning based on sales plans, production plans, and unfulfilled customer orders.
Making orders to suppliers and monitoring their implementation.
Registration and analysis of fulfillment of additional conditions under contracts with fixed nomenclature positions, volumes and terms of deliveries.
Support for various schemes of acceptance of goods from suppliers, including acceptance for sale and receipt of toll raw materials and supplies.
Registration of uninvoiced deliveries with the use of warehouse orders.
Analysis of composition and production needs in goods, finished products, and materials.
So, proper procurement management in data room software can save a company from unpleasant costs. Therefore, the procurement department should consist of trained staff so that its good management strengthens relations with suppliers. In addition, it will allow you to better negotiate purchase prices and achieve better payment terms.