Other attributes
Procurement software is software used to assist the supply chain functions of an organization. Sometimes simplified to purchasing or sourcing, procurement is actually a larger set of tasks associated with buying a product or service. Procurement software is used to handle these tasks, which include but are not limited to:
- Identifying internal needs
- Researching the market
- Shortlisting and approving suppliers
- Creating online purchase orders
- Requesting, evaluating and selecting proposals
- Receiving goods
- Developing and managing contracts
- Obtaining invoice approvals and fulfilling payment terms
- Establishing supplier relationships
Manufacturing procurement is focused on raw materials, machinery, facility services, utilities and maintenance costs. Software is aimed at cost-savings in these departments, especially streamlining inventory to reduce carrying costs and optimize inventory levels by connecting suppliers and warehouse management. Supplier relationships are another important factor in manufacturing procurement and software usually include Supplier Relationship Management (SRS) systems.
E-Commerce procurement is different from other industries due to factors including but not limited to:
- Inventory is usually held by third-parties
- Shipping to individuals requires additional shipping costs and tracking
- Reverse logistics, or facilitating exchanges and returns
- Increased volume of smaller transactions
- Customers expect quicker delivery
- Public customer reviews are critical to business growth
- Excess inventory limits business growth
Healthcare procurement software is used to optimize and streamline the medical supply chain, inventory management and spending. It is intended to connect primary and ancillary care and reduce health risk to patients and legal or economic risk healthcare providers. Hospital procurement software is also important to reducing emotional decision making and ensure fiscal responsibility in the organization. Software is used to combat rising cost of treatments and waste in healthcare spending.
Food and Beverage (F&B) procurement has additional challenges included, due to expiration dates, government guidelines and the challenge of handling multiple suppliers at once. Bottlenecks in the F&B industry can have more severe consequences than other industries due to the risk of food-borne illness, health and safety regulations and consumer demands. Food & Beverage procurement software is aimed at handling multiple product sources, avoiding waste in the supply chain and meeting or beating deadlines.
Supply chain optimization software focuses on operating a supply chain at peak efficiency, reducing operating costs and increasing profit margins. Companies need to look at the expenses along the supply chain and look for ways to streamline processes while keeping quality in their product. Supply chain optimization software has an emphasis on analysis and forecasting of future industry needs, development of warehouse and transportation integration systems and follow-through on the process.
Data integration is the process of combining different data sources in a single channel or view for easier viewing, dataset construction and analysis. Data integration procurement software includes tools which ingest and clean different source data, mapping and graphing the data and integrating it into existing management or analytical platforms. Data integration software is used to reduce errors, create more valuable and digestible datasets, streamline workflows and simplify analytics.
Shipping integration is a key component of procurement software, and allows businesses to gain visibility and communication into their supply chain process. Shipping integration procurement integrates freight costs, inventory visibility and shipping tracking for companies and allows them to combine these insights into their current management systems.
Procurement software often deals with giving businesses insight and information into their business processes so they can automate and streamline their workflow. Risk management is an important factor for businesses which procurement software often targets, spotting where errors or business risks are most likely to occur and reducing human error through automation, planned checks and higher visibility into the supply chain process.
Software-as-a-Services (SaaS) are cloud-based services, which companies use to replace designing and building their own software or running software on their own business networks and computers. Software-as-a-Service procurement companies offer a wide variety of systems across procurement industries and allow businesses to use the latest technology without the costs of development, IT services and server maintenance. At the same time SaaS have downsides including non-ownership over the technology aspects and reliance on a third-party for support.
Blockchain procurement software implements blockchain technology into current procurement and supply chain solutions. Blockchain procurement utilizes specific blockchains to allow personalized keys and increase security on digital transactions and visibility into payments and auditing on inventory. Procurement software utilizing blockchain usually incorporates smart contracts, purchase order management, supply chain tracing and real-time settlement of debts and orders.
