Cloud-based procurement software is efficient for automating every part of a procurement process in business. Read on to know the benefits it offers for the organisations.
The growing popularity of cloud-based solutions owing to the benefits they offer has made several organisations invest in Software as a Service (SaaS) with an ever-increasing adoption rate. Procurement or Purchase-to-Pay (P2P) software is also a part of this implementation.
In this article, we will outline the benefits of automated cloud-based procurement software and its cost-effectiveness for organisations. Before that, let us give you a brief about cloud-based procurement software.
What is Cloud-Based Procurement Software?
A cloud-based procurement software automates every part of the procurement process in a business and streamlines supplier management, purchase requisitions, purchase orders, invoicing and sourcing. Using Software as a Service (SaaS), procurement managers get the required resources affordably and securely. Due to the edges that they offer, cloud procurement systems are the future of procurement.
Global Procurement Software Market
A procurement system allows you to perform the following functions all in one place:
- Purchase order creation
- Contract terms evaluation and price negotiation
- Document revisions
- Supplier selection
- Supplier risk evaluation
- Transaction time reduction
- Supplier invoice processing
- Invoice automation
Cost Drivers of a Cloud-Based Procurement Software:
Want to know the benefits that you could get with implementing an automated cloud-based procurement software? Read on to the next section.
Benefits of Automated Cloud-Based Procurement Software:
Digitization of Manual Procurement
Managing thousands of documents related to important data such as contracts, invoices, and receipts in the organisations manually can be difficult and costly. It can also hamper the company’s operations and its efforts of cost-saving and profit-making. Manual procurement also restricts organisations to access important information. Streamlining procurement activities by making them digital helps in generating greater values and savings. It also helps in saving time and cost in processing huge data. A cloud-based procurement solution automates the process and offers access to clients to the documents remotely.
With cloud-based procurement software, the accounts payable department can work from any location. The software provides real-time information and everyone in the team can operate from the same data version and remove potential errors.
It is difficult to track and manage direct and indirect spendings in large organisations every day if they are not accounted for properly. Procurement software offers dynamic dashboards to give more visibility, enabling management to take decisions strategically and highlighting discrepancies in the process.
Cloud-based procurement solutions help monitor the purchase cycle effectively. It also offers a clear view of the purchase of an item regarding the buyer and the time of purchase. It also helps in reducing the time taken for completing the procurement process by updating the approval status. Procurement software also gives visibility of purchase orders (POs), invoices and spending to keep a track of the money flow.
A vendor invoice makes it easier for the accounting department to check the goods receivable note (GRN) and purchase order (PO). Due to this, vendor payments are processed on time. Account payable departments use invoicing to automate validations before forwarding them for approval to assure that all VAT or GST calculations are correct.
Account departments cross-refer invoices with procurement documents such as contracts and purchase orders for pricing, item descriptions and receipt of the goods. Invoices also determine the specific items purchased by departments, enabling quicker processing of accounts and resulting in shorter payment cycles.
The cloud procurement software requires outsourcing transfers operations and maintenance. The security benefits gained due to this is commendable. It offers automatic updates and security patches reducing the chances of high-profile data breaches. Procurement software and other SaaS solutions hosted on cloud platforms ensure topmost security.
Cloud-based procurement solutions offer flexibility to businesses looking to scale their growth. They let your business adjust the transaction volumes and database as per the new requirements. SaaS software can also be integrated with other business applications to streamline their workflow. If any other integrations are needed, there is always a possibility for custom integrations.
Cloud-based procurement solutions help to reduce the costs required in investing in hardware. They let you try the software for free to assure that it works as per your expectations before the licensing fee is paid. This approach is easily scalable and lets businesses modify their solution to meet their budget and needs.
While making a software purchase, cloud procurement solutions do not need any upfront investments or maintenance expenses. Also, these solutions can be accessed from anywhere, anytime and from any device.
In the coming time, cloud-based procurement systems will be the most in-demand technology owing to the benefits it offers. The adoption rates for cloud-based systems will continue to rise in the future.
One such e-procurement solution is Procol, which you can always rely on for getting more flexibility, user-friendliness, cost-efficacy, and enterprise-grade security!