When Should A Company Use A Digital Procurement Solution?
Every company from a start up to a billion-pound turnover company procures good and services. The basic processes of procurement will be the same for all companies, irrelevant of their size. The processes being the sourcing of the goods or services, managing supply contracts and suppliers and monitoring savings achieved as a result.
The processes will obviously be far more complex and take far longer to complete for a larger company than a start-up. For example, for sourcing there will be larger spend and more stakeholders and decision makers involved. As a result, most companies will have their own procurement processes with guidelines for employees to follow to ensure they have consistency, transparency, and control over the whole process from start to finish to ensure they receive the best value from their suppliers.
Many of these larger companies, as with many other areas within their businesses, have invested both time and money into a digital solution to enable them to leverage the benefits of having control over the procurement processes to save valuable time and money and ultimately increase profit margins.
A start-up will follow the same steps in the procurement processes, although it will be less apparent that they’re following a process as it’s something that they will just subconsciously do to get the best value from their suppliers.
As the start-up grows there will be a loss of control over the procurement processes and the risk of not getting best value, wasting money and eroding profitability will increase. At this point the company may decide to put processes and policies in place.
However more than likely they will be too busy concentrating on growing sales and hitting revenue targets to pay too much attention to procurement unless it’s for goods and services that make a substantial part of their costs to deliver a product or service. By ignoring the procurement processes they will be missing out on opportunities to save valuable time and money, ensure they work with compliant suppliers and suppliers whose values align with their own. Basically, they will more than likely be unnecessarily throwing away some of their hard-earned money.
As the company expands further it may begin to use spreadsheets, calendars and shared drives to manage the procurement process. This is exactly what companies have done in the past to manage client relationships before CRM systems became readily available and affordable to small and medium sized companies.
For any company considering investing in a digital procurement digital solution, they must consider the processes and desired outcomes, budget/return on investment and the uptake of use by employees. These considerations will vary from company to company and depending on many variables, including amount of spend under contract and the industry they’re in.
Now there is a digital procurement solution that has been designed specifically for SMEs called oboloo. oboloo is an intuitive and simple self-service platform that gives consistency, visibility and control over all sourcing, contract, supplier and savings management. oboloo enables companies to be supplier smart. To learn more please visit www.oboloo.com.