Purchasing effectiveness is critical to the success of a business. According to a survey conducted by Deloitte, 79 percent of organizations with superior supply-chain capabilities achieve revenue growth that is significantly above average. But simply overloading your purchasing department with sophisticated processes is not the best idea. What if you let your B2B purchasing portal run the show, automating the procurement process? Let’s explore its powers.
Centralized purchasing makes suppliers more willing to collaborate. They’re more interested in signing one contract for a large volume, instead of multiple small ones. In addition, it improves your bargaining position. And you avoid time-consuming paperwork.
A logical approach is to give the authority to one central department. But it can also introduce difficulties, especially when branch offices are scattered geographically and in remote locations.
With a B2B purchasing portal, you can easily consolidate communication with vendors and manage orders from multiple branch offices in one place. Branch managers can independently make orders and combine them into a common one. A side benefit of this practice is that it streamlines the payment process, creating a single bill instead of multiple ones.
The costs of supply chain disruption are high, taking the form of increased waiting times, delivery of defective products, and dead stock. In the event of a sudden change in the manufacturing plan or price hike from a usual vendor, you need to determine where you can get the required amount of product quickly and at the best price.
By bringing together the entire procurement process and integrating with internal systems (including your enterprise resource planning application), a B2B purchasing portal allows you to manage the supply chain in a smarter way, and address sudden changes in a timely manner.
With its thoroughly structured vendor data, it becomes easier to make considered decisions. The buyer can quickly compare in real time all possible offers by discounts, delivery conditions, and required documentation. The portal information visibility makes it possible to check plans, schedules, and expected delivery dates, and track the reliability of vendors based on the history of your previous interactions. When new customer orders appear, you can determine in minutes their potential for fulfillment, and plan production and transportation accordingly. Or you can quickly and easily get information about substitute products in case of an urgent need.
With vendors digitally catalogued in a B2B purchasing portal, it becomes easier to control the quality of delivered products. You can compare multiple available offers in a few clicks, and favor the best ones in terms of value for money.
The rating system allows you to make more considered decisions, and minimize dealing with poor-quality products. You can quickly evaluate the performance history of your vendors, and instantly see who has breached your trust.
Businesses today find it easier to work with major suppliers, and tend to overlook the advantages of purchasing from local small businesses. Local companies can provide better options for delivery – they’re more flexible in case of market changes, and can help to diversify the range of products your company offers.
For big companies with representation in multiple cities, regions and countries, “local” can mean thousands of individual locations. The portal helps to engage small and medium-sized businesses and navigate quickly among them. It also enables continuous communication of your needs and requirements.
The result is smarter inventory management, allowing companies to save significant amounts of money, minimize storage time, and reduce liquidation costs, which is central to the concept of just-in-time manufacturing.
A purchasing portal allows you to exchange messages and participate in live chats in a matter of minutes, versus the delays that often accompany the sending of emails. Purchasing managers can quickly identify the most profitable option on the portal. And vendors get valuable information about what’s expected from them, and what can be improved.
A B2B vendor portal helps to improve the purchasing process in multiple ways. It contributes to effective communication with vendors, keeps inventories smartly managed, provides competitive access for small local suppliers, streamlines centralized purchasing, and ensures supply-chain coherence.
Vadzim Belski is head of web development at ScienceSoft.