Procurement involves acquiring goods, services, or works from an external source in a way that meets needs at the best possible cost. The procurement life cycle includes identifying needs, finding suppliers, communicating with them, negotiating contracts, managing supplier relationships, and handling logistics. E-procurement automates this process electronically to reduce costs, increase transparency and productivity, eliminate paperwork, and speed up transactions. While e-procurement provides benefits, risks include over-investing in tools that don't deliver value or that users reject, as well as suppliers who don't cooperate.

1. PROCUREMENT
By Nikhita Anchan

2. WHAT IS PROCUREMENT?
 Procurement is the acquisition of goods, services or works from an
external source(another firm).
 It is favourable that the goods, services or works are appropriate and that
they are procured at the best possible cost to meet the needs of the
acquirer in terms of quality and quantity, time, and location.

3. PROCUREMENT LIFE CYCLE

4. Identification of Need Supplier Identification
Supplier
Communication
Logistics Management Supplier Liaison Negotiation

5. PROCUREMENT LIFE CYCLE
1.Identification of Need:This is an internal step for a company that involves
understanding of the company needs by establishing a short term strategy ( three to five
years) followed by defining the technical direction and requirements.
2.Supplier Identification: Once the company has answered important questions like:
Make-buy, multiple vs. single suppliers, then it needs to identify who can provide the
required product/service (P/S).There are many sources to search for supplier and trade
shows.
3.Supplier Communication: When one or more suitable suppliers have been
identified, requests for quotation, requests for proposals(RFP), requests for information
or requests for tender may be advertised, or direct contact may be made with the
suppliers. References for product/service quality are consulted, and any requirements for
follow-up services are investigated.

6. PROCUREMENT LIFE CYCLE
4.Negotiation: Negotiations are undertaken, and price, availability, and customization
possibilities are established. Delivery schedules are negotiated, and a contract to
acquired
5.Supplier Liaison: During this phase, the company evaluates the performance of the P/S
and any accompanying service support, as they are consumed. Supplier score card is a
popular tool for this purpose .When the P/S has been consumed or disposed of, the
contract expires, or the product or service is to be re-ordered, company experience with
the P/S is reviewed. If the P/S is to be re-ordered, the company determines whether to
consider other suppliers or to continue with the same supplier.
6.Logistics Management: Supplier preparation, expediting- shipment, delivery, and
payment for the P/S are completed, based on contract terms. Installation and training
may also be included.

7. E-PROCUREMENT
 E-procurement is the business-to-businessor, business-to-
consumer or business-to-government purchase and sale of supplies, work,
and services through the Internet.

8. PROCUREMENT SOFTWARE
 Procurement software is business software that helps to automate the
purchasing function of organizations. Activities including raising and
approving purchase orders, selecting and ordering the product or service,
receiving and matching the invoice and order, and paying the bill is handled
electronically
 There are more than one hundred e-Procurement solutions available
today.

9. SOME E PROCUREMENT SOFTWARES

10. ADVANTAGES OF E PROCUREMENT
 ReducedCosts
E-procurement saves you money by preventing duplicate spending, leveraging volume buying, and saving you
costs associated with paper-based systems (for example, the cost of stamps to mail your paperwork).
 Transparent Spending
Electronically conducting your procurement makes it easier to write and analyze reports on your
procurement systems, meaning you can ensure that your procurement procedures conform to your
policies.
 Increased Productivity
Once you've learned the system, e-procurement is less time-consuming than traditional procurement.
Having your records stored electronically makes it easier to submit reusable tenders. Meanwhile, use of
templates means paperwork can be filled out more quickly.

11. ADVANTAGES OF E PROCUREMENT
 Eliminating Paperwork
Tired of finding new space to store all that paperwork?With e-procurement, everything can be saved and stored electronically. This not only
saves you from needing more room, it also makes the process of finding older tenders more simple.
 IncreasedTransaction Speed
E-procurement is both time-saving and efficient. As the electronic handling of tasks supports and simplifies the purchasing process,
transaction speed is increased. Also, because of e-enabled relationships with suppliers, procurement cycle times speed up.The e-
procurement process eliminates unnecessary activities, allowing you to focus on more valuable tasks.
 Standardized Buying
When you have various departments making procurement decisions, there can be differences in what and how they purchase. Conducting
purchasing electronically makes it easier for every department to conform to company procurement standards.

12. RISKS OF E PROCUREMENT
 One of the primary risks is missing opportunities to implement strategies that improve
procurement management without the need for investment in e-procurement.This is
because many of the benefits ascribed to e-procurement may be achieved simply by
improving procurement practice.
 Another risk is over-investment in e-procurement tools that do not deliver the expected
benefits.This risk arises when there has been inadequate evaluation of the implications
of the adoption or enhancement of e-procurement tools.
 The risk that users will not accept an e-procurement tool is another common risk.This
risk often arises where users have not been adequately consulted about the adoption or
enhancement of particular tools.
 On the supply side, there is a risk that suppliers will not cooperate with the use of e-
procurement tools.

13. THANKYOU!