Useful Strategies to Reduce Cost in Procurement Management
There are several stages in the procurement process: creation and approval of the purchase request, sourcing, purchase order processing, management of the contractual conditions fulfillment, order’s delivery, order’s posting, control and confirmation of bills payment. Each step is accompanied by document flow and by labor costs of employees of the administrative, financial and logistic department.
As an example, let’s examine the procurement process for the office and its employee: administrative officer determines the basic office needs and creates purchase request; chief financial officer confirms purchase request — after that purchase request is sent to the purchasing department. By analyzing all purchase requests, purchasing department selects the potential supplier, confirms physical presence of the required goods and services, generates the order and sends it to supplier; supplier delivers goods with all the relevant documents that confirm delivery (including the account) to the location of the enterprise (no matter whether it is warehouse or office directly); administrative officer examines all the delivered goods and generates a payment request for a transaction, which is transferred to the Finance Department; finance controller, in turn, confirms the compliance with purchase request, order, delivery of documents and accounts, and then the accountant pays the bill.
Precoro helps to save time at each of the above steps, simplifies document flow process, facilitates the work of the financial and accounting departments at the stage of monitoring and financial reporting.
With the help of cloud solutions, that don’t need to be installed on the hardware of the enterprise, it is possible to:
- Create a limited catalog of goods and services (orders can be carried out on a regular basis);
- Set budget limits for certain categories and periods of time, or set limits for specific structural units;
- Develop a map that will show purchase request data, according to the organizational features of the enterprise;
- Provide real-time communication between suppliers and supply department;
- Provide detailed expenses scheme
All of the above opportunities consolidate procurement process and ensure its visibility. As a result, it is much easier to reduce business costs across the enterprise.
Precoro has a high level of integration with other enterprise management systems, including the global ones. It is easy in use and in implementation. Its flexible pricing is another benefit.
Today, most spend management experts consider Precoro as the perfect spend management tool as it moves in the direction of expense management, tries to enter into contracts with suppliers, works on verification, processing, and payment of electronic invoices, as well as improves electronic document technologies.