No matter whether you’re an eager entrepreneur launching a groundbreaking startup, or the CEO of a multi-million dollar corporation poised for industry dominance, choosing a procurement platform can be a challenge.
Evaluating and choosing procurement software, including solutions for indirect procurement, involves self-reflection, research, and honest evaluation. Because there are so many solutions available, this process is essential to choosing a platform that is tailored to your organization’s needs.
Even worse, Googling “procurement tools” doesn’t help - you’re likely to wade through dozens of “reviews” written to try to lead you to one specific platform or another.Instead of leaving you to wade through the claims of procurement software companies, we’ve put together this article to help you find the best PO system for you.
How procurement used to be
Not so long ago, companies used to rely on paper-based systems to obtain and pay for items that employees need to do their jobs and fulfill customers’ needs.
This created several critical problems. First, it introduced the element of human error - a purchasing manager who reviews 50 requisitions a day could hardly be blamed for transposing an item number on a purchase order. Still, simple errors like this can delay procurement by weeks, increase the company’s procurement costs, and erode employee trust in the organization. In fact, if you want to learn more, we created an e-book describing the Top 6 Purchasing Mistakes and How to Avoid them.
Second, purchasing managers were bogged down with requisition forms. In most cases, a “purchasing manager” is an employee who also performs other duties, such as operational management. That means that, during busy times, requisitions might be forgotten for days or weeks.
When the purchasing manager finally has an opportunity to review requisition forms, it’s usually between meetings or other pressing tasks. The manager rifles through the stack of requisitions, accepting or rejecting based only on a brief scan of each.
Finally, a paper-based system is nearly impossible to track. Requisition forms can be lost, destroyed, or rendered unreadable. Likewise, purchase orders can vanish en route to suppliers, and employees can be left waiting for items that will never arrive.
Procurement software tools eliminate these concerns, helping your company to obtain necessary products and services without the typical delays, mistakes, and overspending that comes with a traditional, paper-based procurement system.
What is procurement software now?
Procurement software, also referred to as “spend management software,” is a digital platform that replaces the traditional paper-based procurement process with an efficient, low-touch purchasing platform that eliminates errors, guesswork, and wasted money.
There are numerous platforms tailored to certain business owners. Some serve as procurement software for small business, empowering solopreneurs and small teams to cultivate a solid financial foundation without the need for extensive accounting knowledge and experience.
Other purchasing software platforms cater to large corporations with complex needs and hundreds (or even thousands) of users. While these platforms might not be beginner-friendly, they do provide the scalability and flexibility that today’s larger companies require.
Still others, such as ControlHub, offer the simplicity of a small business procurement solution with the scalability and flexibility of corporate procurement platforms.
The primary goal of integrating any purchasing tool should be to streamline the procurement process for employees, simplify the approval process for purchasing managers, and automate tracking and reporting so that owners and key stakeholders can access real-time spending data to drive their business decisions.
When you're looking for the best purchasing software for your organization, here is an easy checklist to help ensure that the solution you choose is the best one for the ongoing needs of your company:
- Mobile device accessibility - today, it’s unlikely that an employee who needs to order an item will be sitting at a desk in a physical office. The global trend toward remote work prompted by the COVID-19 pandemic and variant threats has changed how employees expect to request - and receive - items necessary to perform their job duties.
Your company’s procurement software should feature requisition software with a mobile-first design. This allows employees to request the items they need from their phones or tablets, instead of having to wait until they are in front of a desktop computer.
- Simplicity of use - The more difficult a platform is to use, the longer employees and purchasing managers will spend on each task. The best procurement platforms feature intuitive dashboards where users can quickly find and accomplish what they need. This allows them to return to their other job duties more quickly and with minimal disruption.
- Easy integrations with existing accounting systems - If you’re already using Quickbooks, Netsuite, or other accounting software, you won’t want to transfer the information by hand. Your procurement management tool should seamlessly integrate with your accounting software, so that you can automate the flow of purchasing data into your overall accounting process.
- Straightforward employee onboarding and use - Your employees probably already have many tasks to handle every day. Learning a complex procurement system shouldn’t be an additional burden. Look for a spend management system that provides simple, easy-to-understand features and tools that employees can master quickly. This will help ensure that employees use the platform, rather than trying to bypass it.
- Robust, responsive customer support - Can you reach a knowledgeable support representative any time of the day or night? Can the platform’s representatives help you resolve problems and answer questions quickly? Some platforms, such as ControlHub, provide users with 24/7 access to live support - people who actually understand the questions they receive and provide actionable help to resolve callers’ problems.
- Start-to-finish automation and support - The best procurement platforms streamline and digitize every element of the procurement process, from requisition to delivery and payment. Automated, customized workflows and tracking ensure full documentation of every transaction. This dramatically decreases your company’s exposure to fraudulent and rogue spending, purchasing errors, vendor disagreements resulting from lost or damaged paperwork, and other common procurement problems.
- Customizable procurement workflows - Taking a “one size fits all” approach to procurement is a recipe for financial disaster. Each employee needs tailored access to payment methods and funds. Some of your well-trusted employees might deserve a spending “threshold,” below which purchases do not need approval. Others may require approval for all purchases, regardless of the amount.
- Instant spend tracking - when an employee makes a purchase, you want to know about it right away - not at the end of the month. Otherwise, you could be hit with dozens of end-of-month surprises. This can destabilize your budget and even hamper growth.
Companies traditionally only reconcile purchases once a month, which leaves plenty of time for excessive, duplicate, and fraudulent purchases to slip between the cracks. By choosing a procurement software platform that offers real-time tracking, though, you can identify potential problems before they can substantially impact your organization’s finances.
- Complete spend insights, analytics, and reporting - having detailed, accurate financial reports at your fingertips can greatly increase your confidence as a CEO, CMO, or other key member of your organization. At-a-glance reporting lets you make decisions quickly, which can help your company achieve rapid growth and take advantage of new opportunities faster and more skillfully than your competitors.
- Digital tracking for audits and reviews - There’s no need to keep paper copies of receipts, requisitions, expense forms, purchase orders, or other typical procurement documentation. Look for a spend management platform that allows you to digitize all of your data, so that you and your team can access and analyze the data for better procurement decisions in the future.
- Seamless matching of requisitions, purchase orders (PO), and invoices - In past decades, some unfortunate soul in each company would be tasked with reconciliation - matching up requisition forms, purchase orders (PO), and invoices, including the associated PO number, for each purchase. Then, they would need to assign the purchase to a specific department or team for budgeting.
With a procurement management platform like ControlHub, all of these tasks are fully automated. This not only saves countless hours at the end of each month; it eliminates transpositional and clerical errors that can cause serious inaccuracies in your accounting process.
If you’re tired of trying to manage your procurement processes by hand or with a folder full of spreadsheets, request a Demo about ControlHub now. Their robust yet intuitive platform simplifies and automates your procurement process, making everyone’s job easier.
Understanding the Role of Purchase Requisition vs Purchase Order
In the world of procurement software, it's essential to grasp the distinction between purchase requisitions and purchase orders. These two elements play a pivotal role in efficient procurement management:
Purchase Requisition: This is the initial step in the procurement process. It's essentially a request made by an employee or department within an organization to signal the need for specific products or services. Purchase requisitions help initiate the purchasing workflow and ensure that the procurement process aligns with the organization's budget and policies.
Purchase Order: On the other hand, a purchase order is the official document sent to suppliers or vendors once a purchase requisition has been approved. It contains detailed information, including item descriptions, quantities, prices, delivery dates, and payment terms. Purchase orders serve as legally binding agreements and play a critical role in tracking orders, managing inventory, and facilitating accurate record-keeping.
Integrating a robust procurement software solution, like ControlHub, can enhance the efficiency of both purchase requisition and purchase order processes. It simplifies workflows for employees, streamlines approval processes for purchasing managers, and automates tracking and reporting, providing real-time spending data for informed business decision-making.
The Significance of Purchase Orders Template in Procurement
Harnessing the efficiency of purchase orders templates is akin to setting a foundational pillar for your hardware startup's procurement processes. A well-structured template provides a standardized format and ensures consistency in capturing vital order details. With the dynamism that hardware startups usually display, any tool that fosters streamlined, repeatable, and error-free operations is invaluable. When embedded within an automated purchase order system, such templates become the bedrock for speed, accuracy, and scalability. While automation is the engine driving the procurement car, the purchase orders template is the blueprint, ensuring the vehicle is built to perfection.
Automate your procurement process: Say no to paper.
While the manual PO process is tedious, embracing technology in your hardware startup can be helpful in several ways. However, this will be a challenging transition. Adopting a purchase order template requires updating technology, aligning internal processes, and often initiating a cultural shift. In return, your startup gains productivity, prevents duplicate orders, and realizes a more efficient procurement cycle. Plus, the environmental benefits of reducing paper usage are undeniable.
A flexible purchasing process
Automating your PO process allows customized automated workflows tailored to each purchase request. These workflows can be aligned with internal rules and legal requirements, providing flexibility for varying scenarios such as high-demand periods or large one-time purchases. The crux of this automation lies in the ease with which a purchase orders template can be utilized, bringing about uniformity and speed.
Enhanced value in procurement
The transparency and accountability an automated purchase order system offers are unparalleled. Integrations with other departments or vendors ensure favorable ROI and controlled spending. The system's efficiency also redirects resources from manual data entry to more core engineering tasks.
Streamline your procurement process
Creating workflows through purchase order templates simplifies and accelerates the process. These templates reduce repetitive tasks and, when coupled with cloud-based systems, offer global accessibility, further diminishing approval delays.
Be more productive with the ControlHub System.
Balancing procurement tasks with engineering duties can be a challenge. Yet, automating the procurement process, setting up vendors, creating and accepting purchase orders, and approving spending become seamless. Partnering with ControlHub amplifies these benefits, ensuring your startup fully capitalizes on what automated procurement offers. Leap and engage with us today for an insightful consultation.
Frequently Asked Questions
What is procurement software?
Procurement software is a digital platform that revolutionizes the way organizations obtain and pay for the things they need. It streamlines and automates the procurement process, eliminating errors, improving efficiency, and providing accurate financial tracking and reporting.
Is there a procurement platform suitable for businesses of all sizes?
Absolutely! There are procurement platforms designed to cater to the needs of businesses of all sizes. From solopreneurs to large corporations, you can find a solution that fits your unique requirements. Some platforms offer scalability and flexibility, while others provide simplicity and ease of use.
What makes ControlHub a great procurement platform?
ControlHub offers the best of both worlds. It combines the simplicity of a small business solution with the power and scalability of a corporate platform. With ControlHub, you can streamline your procurement process, integrate with existing accounting software, and enjoy features that cater to your specific needs.
How do I choose the best procurement software for my organization?
Choosing the best procurement software involves considering several factors. Look for mobile device accessibility, simplicity of use, integration with existing systems, employee onboarding, robust customer support, automation capabilities, customizable workflows, real-time spend tracking, comprehensive analytics and reporting, digital data tracking, and automated reconciliation.
Why is automation important in procurement software?
Automation is crucial in procurement software because it eliminates manual errors, reduces paperwork, and streamlines the entire procurement process. It improves efficiency, prevents fraud, ensures accuracy, and saves time. With automation, you can bring your procurement process into the future and focus on more strategic tasks.
How does procurement software benefit CEOs and business owners?
Procurement software benefits CEOs and business owners by providing streamlined and efficient procurement processes. It enables better control over spending, improves financial tracking and reporting, enhances decision-making with comprehensive analytics, and reduces time spent on manual tasks. With procurement software, CEOs and business owners can focus on driving their businesses forward.
How can I request a demo of ControlHub?
Ready to transform your procurement process with ControlHub? Request a demo today by reaching out to their team. They will guide you through the features and benefits of the platform, answer any questions you have, and help you see firsthand how ControlHub can revolutionize your procurement efforts.