Why Suppliers and Buyers Need E-Sourcing

why suppliers and buyers need e-sourcing

While the benefits of eSourcing are evident to buyers, suppliers are wary about automating the procurement process. The fear comes from the assumption that any sort of automation is overwhelmingly biased in favor of the buyer.

However, eSourcing systems can also provide real-time dynamic feedback and promote strategic cooperation, making it a valuable tool for buyers and suppliers.

Here are five ways that eSourcing benefits both parties.

Photo by Cytonn Photography on Unsplash 

1. Maximizing Transparency

Most eSourcing solutions can provide real-time feedback via analytics tools and detailed ranking. This indicates that not only do buyers get a clear view of suppliers and their offerings, but suppliers also gain unparalleled competitive knowledge. Insight into the competition, such as bidding in reverse auctions, helps suppliers better understand their own pricing model.

2. Ensuring Fairness

eSourcing systems provide equal access to buyer data for all suppliers. This encourages fair play among all players and ensures everyone gets the same questions and replies. On the other hand, eliminating bias from the procurement process guarantees that purchasers receive the finest offers and alternatives from suppliers.

3. Building Trust

Buyers will begin by briefing several providers on the specifics of their requests. Following that, a supplier will make an offer to the buyer. Buyers will often disclose the pricing given by supplier A to supplier B to negotiate all supplier bids.

The entire procedure is time-consuming and tends to generate an unfriendly dynamic between buyers and sellers. While customers may get their ideal offers, suppliers may feel unfairly treated. This is not an ideal approach to establishing a professional relationship.

eSourcing can handle this task with ease. The market determines the price, and because it is public, it cannot be blamed on a single supplier or the buyer’s negotiating abilities.

4. Saving Time

The procurement procedure involves a lot of back and forth. Communications alone can waste hours, if not days, of an already hectic schedule. And that is before any negotiations. Allowing buyers and suppliers to use templates and communicate through a shared platform to all key parties may greatly simplify the process for everyone.

5. Creating Opportunities

eSourcing solutions significantly boost efficiency for buyers and are easy to use for suppliers. Once they understand how the system works, it will be easier for them to participate in bids for the firm and secure deals.

Bottom Line

While fully adopting e-sourcing solutions will take some time and adjustments, the reality is that buyers and suppliers will significantly benefit from using such systems. All they need is access to a reliable e-sourcing provider that can offer the right solution for both parties. Luckily, that’s precisely what we do here at Penny. All you need to do is to contact us and let us seal the perfect partnership.

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Frequently Asked Questions

Penny is a cloud-based Procure-To-Pay system. penny helps you digitize and manage your full procurement cycle from request to approval. Manage RFQs to vendors, compare quotations, send POs and even payment. penny was designed to make things easy and consolidate all of your organization’s spending needs into one intelligent system.

  • Allocate, manage and monitor budgets by expense accounts, projects, departments, location, teams..etc 
  • Streamlining procurement means requests, approvals, and POs won’t be lost in emails or offline.  
  • History and records of requests and purchases can be extracted and tracked easily via the platform. 
  • Product requests are more accurate through the catalog, and hence avoid purchasing mistakes.
  • Reports and analysis can be extracted from the platform, giving you a consolidated data center for all your procurement activities.
  • penny is cloud-based and an easy to use platform. The action-board gives your team a user-friendly and simple experience.

Yes, penny is designed to handle complex procurement operations. We make EVERYTHING simple. Via the contract management feature, you can set the terms and conditions of your contract, and the system will recognize the products and the vendors of your request and match it with specified terms of your contract. Easy.

Putting you in control of your spending is integral to our mission. penny allows you to create Expense Accounts that match your P&L, and assign budgets to them. For example, you can assign $X for your “Travel Budget” and reflect on the budget before approving a travel request. In addition, penny allows you to set budgets for cost centers like projects, departments, locations, and so much more. With penny, you can extract reports and view your spend per Expense Accounts or cost center.

Yes. If your product search finds no results, you can submit a non-standard request.

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