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7 Main Functions Of The Procurement Process For Your Business

E-procurement process functions include issuing and evaluating tenders, raising and approving purchase orders, selecting and ordering products or services, receiving and matching invoices and orders, and paying invoices, allowing the procurement department to view everything ordered, ensuring nothing can be ordered without approval right, and get the best value by combining multiple orders for the same type of item or even asking a supplier to bid on the business.

Key benefits to organizations using procurement software include ease of administration, access to information, and potential long-term cost savings. Having a single interface for procurement-related management information saves the time and effort required to monitor organizational expenses. The use of such software also allows procurement managers to control the vendors used by the wider organization so that all employees take advantage of negotiated rates and other terms of service.

In the case of procurement software, the benefits may be efficiency, transparency, equity, fairness, and local business incentives. Because e-procurement increases competition, lowers transaction costs, and potentially minimizes time and errors in the bidding process, efficiencies are achieved. Due to the easier accessibility and openness of the internet, more people can get information earlier, which increases transparency. Neutrality to location and time ensures equality and fairness.

Here are some of the e-procurement Process main functions you might need for your business right now:

1: E-Purchasing

As opposed to e-Tendering, e-Purchasing is used in the procurement of goods and services that are of low value and high volume. It electronically simplifies the purchasing process of such goods and services. For this type of procurement, catalogs are one of the key components that often occur. Key components of this system are often complex, and thus system development is often needed. The process starts from the publication of items online by the suppliers, and continues to the electronic selection, order, reception, and finishes with payment by the purchasing side.

2: E-Ordering

Process of creating and approving purchasing requisition, both placing purchase orders and receiving goods and services ordered while using a software system based on internet technology which greatly improves the supply chain performance. When talking about e-ordering, ordered goods and services are generally non-product related, in other words – indirect. In the case of Enterprise Resources Planning (ERP) the goods and services ordered are product-related. Both the supporting software system and ordering catalog system are designed to be used by all employees of an organization.

3: E-Invoicing

E-Invoicing is any method by which an invoice is electronically presented to a customer for payment. In larger companies, accounts payable departments are responsible for the invoices to be approved, processed, and paid.

4: E-Contract Management

This type of management consists of the management of receivables, payments, contract settlements, contract variations, performance securities, and auditing and control activities, and as opposed to its classical form, e-Contract Management is its electronic improvement.

5: E-Informing

E-Informing does not directly take part in the purchasing process, this process rather precedes the purchasing. It is the process of gathering and distributing purchasing information both from and to internal and external parties, using internet technology. Information sharing refers to the extent to which critical and proprietary information is communicated to one’s supply chain partner thus more efficiency and high performance of the supply chain. In information sharing, also information quality is considered. That includes accuracy, timeliness, adequacy, and credibility of information exchanged.

6: E-Tendering

The purpose of e-tendering is to enhance the process of tendering for the procurement of specialized works, goods, or consulting services of low volume but have a high value.

7: E-Auctioning 

E-auction is the process of conducting an auction to sell assets, natural resources, or other goods through online competitive bidding. Compared to physical auction, the electronic auction provides complete transparency and enables more parties to take part.

The purchasing organization’s software choices may be driven by the specific strengths each system offers and the number of vendors available through them. A multinational or other large organization will use a co-procurement system to take advantage of economies of scale to lower purchasing costs. While some services are available for purchase through automated systems, the main strength of this system lies in the procurement of commodities that are much easier to standardize.

So what is the e-procurement process like?

It’s the series of processes that are essential to get products or services from requisition to purchase order and invoice approval. Although we use procurement’ and purchasing’ interchangeably, they slightly differ from each other.

While purchasing is the overarching process of obtaining necessary goods and services on behalf of an organization, procurement describes the activities involved in obtaining them. The procurement process in an organization is unique to its context and operations.

Regardless of the uniqueness, every procurement management process consists of 3 Ps’, namely Process, People, and Paperwork.

1: Process

The list of rules that need to be followed while reviewing, ordering, obtaining, and paying for goods/services. Checkpoints/steps increase with the complexity of the purchase.

2: People

These are stakeholders and their specific responsibility in the procurement cycle. They take care of initiating or authorizing every stage of the process. The number of stakeholders involved is directly proportional to the risk and value of the purchase.

3: Paper

This refers to the paperwork and documentation involved in every stage of the procurement process flow, all of which are collected and stored for reference and auditing reasons.


The function of e-procurement (electronic procurement, sometimes also known as supplier exchange) is the business-to-business or business-to-consumer or business-to-government buying and selling of supplies, jobs, and services over the Internet and other information systems, such as electronic data exchange and enterprise resource planning

Implementing an e-procurement system benefits all levels of the organization, Because the e-procurement system offers greater visibility and control of spending and helps financial officers match purchases with purchase orders, receipts, and job tickets, the e-procurement system also manages tenders via the internet and website for business.

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