The procurement process can be tricky, especially when it is being managed in larger corporations. Procurement can also be challenging for small businesses in terms of saving time and costs. With all the different systems that can be used for procurement and supply chain management, there might be confusion on implementation, which can cause inefficiencies.
With this in mind, how can you improve your procurement process? Here are the best ways to improve the procurement process for large and small businesses alike:
Utilizing a contract management system
To get high-quality service and the best pricing, negotiating and securing contracts for goods and services is very important. When the number of contracts you have signed with different suppliers increases, managing all of them at once can be very challenging. To simplify the process, consider adopting a contract management system that is best for your specific needs.
That includes managing templates for different kinds of transactions and ones for long-term relationships. Using those processes parallel to the system, Specright has developed a solution to ensure the quality and specifications of each item ordered seamlessly. Its tool offers a spec-first approach, 360-degree view of quality, meaningful insights and detailed reporting, all of which help prevent quality issues in your supply chain.
Annual supplier review
If you have secured contracts for continual replenishment and/or services, reviewing the supplier regularly is very important. Set some benchmarks to review and assess the performance of each supplier. Set up an annual review meeting regularly with the supplier to go through the KPIs and the supplier’s performance.
If it slacks in any way, discuss solutions to fix the problems or consider sourcing a new supplier. Doing this can help you get the best products and/or services time and again, ensuring that your production processes are not disturbed in any way.
Having a digital purchase order paper trail
Recordkeeping and auditing procurement processes are a nightmare when every purchase order is printed and kept in a folder. Keeping up with the paper trail might lead to inaccurate purchase order volumes since papers can be damaged or thrown away with other less-important or outdated documents.
To ensure that this does not happen within your procurement department, have a digital system to file and retrieve all Purchase Orders. Some of these systems are easily accessible using cloud systems and can be shared with other departments or business branches for accurate record keeping and auditing.
Integrate receiving systems with procurement
Procurement, receiving and inventory management go hand-in-hand. The supply chain department needs to ensure when to replenish goods before they are depleted and also know when items have been received in. With that in mind, it makes sense to have a system that tracks each step for efficacy and prompt resolution on undelivered orders or if wrong items were shipped.
Some systems come with features for all these roles in-built, whereas you may need to integrate others using plugins or third-party apps. You can choose the best one for the type of operation you’re running.
Consolidate as many items on a single purchase order
One of the greatest costs companies incur is ordering items from separate suppliers instead of dedicating one for certain goods. Doing this is great for process efficiency and cost savings since more items can be ordered on a single purchase order.
This helps reduce some shipping expenses, have similar lead times and reduce the amount of time spent on purchase orders and sourcing as well. Train employees on how and when to consolidate orders to see amazing overall resources.