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How To Tell If You Need Procurement Automation Software
Have you ever found yourself thinking it’d be nice if the purchasing process in your company worked more smoothly?
Maybe you’ve had trouble with misplaced paperwork, or invoices that don’t match purchase orders, or problems with purchases going over-budget. Whatever you’re struggling with in the procurement system, these problems are a good sign that it’s time for a change.
Procurement automation software is becoming more widely used and more popular every day. But sometimes, it’s hard to know when it’s time to make the switch from traditional systems to a digital and/or automated process. Struggles in the procurement department are a pretty reliable indication that your company could benefit from a new procurement system.
When Problems Develop
It’s pretty common for companies to develop problems in their procurement department as they grow. When your company is expanding, systems that worked just fine in the beginning can’t always keep up with the new workload. These problems can include:
- An order shows up with an invoice and packing slip, but you can’t find a purchase order that matches it.
- The delivery seems to be missing items, but there’s no purchase order on file that would prove what you ordered.
- Invoices show up in accounting after the payment due date with no accompanying paperwork.
- You receive a delivery with all the right paperwork, but there isn’t enough money in the budget to cover the purchase.
Sorting out these types of hassles is both costly and time-consuming. And the longer you let things go on without updating the procurement process, the worse it’s going to get.
The Struggles of Paper-Based Systems
In a manual, paper-based system purchasing can become a cumbersome and time-consuming process. First, the department with a need files a purchasing request. Then a supervisor or the accounting department determines whether or not the request fits in the budget and merits approval.
Next, the purchasing department submits a purchase order to the supplier. If the product or supplier is one your company hasn’t used before, this can take extra time. In general, especially for large purchases, it’s a good idea to get price quotes from multiple suppliers before choosing one.
Finally, your company receives the goods you ordered. Now it’s time to check the purchase order against the invoice and packing slip. You may also double-check the delivery and record all items on a goods received document for 3-way matching.
Because all these steps can become cumbersome in a paper-based process, it’s tempting to skip some of them. That can lead to problems down the road. And even if everyone follows your company’s purchasing policies, human errors can still creep in and paperwork can still be lost.
Streamlining The Purchasing Process
Procurement automation follows the same basic steps as the purchasing process in a paper-based system. But it makes the entire process a whole lot easier by streamlining all the steps through one central program.
Those needing to make purchases can simply log-in to the procurement system and easily shop from a list of pre-approved items and suppliers. For purchases that require authorization, it’s easy to submit purchasing requests through the software system.
Once it’s time to generate a purchase order, the procurement system includes custom templates that make the process simple. You can also submit POs directly to suppliers through your system if they accept digital purchase orders. And while you’re doing this, the system keeps track of every single file generated so you never lose track of important paperwork again. You can even get Accounts Payable software that integrates with your Purchasing software to make things even easier.
If you’re looking for a new procurement solution, we can help. NextProcess offers reliable, flexible procurement software to meet all your purchasing needs. Plus, our suite of programs is all compatible with one another so you can easily add AP automation as well. Click here to learn more or schedule a free demo.