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Purchase to pay software & solutions, Why Companies Must Use It

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In the world of work, you must often hear the words Procurement and purchasing. Often, we find it difficult to tell the difference because the two are interrelated. However, the two have different meanings.

 

Both purchasing and procurement are interrelated because both of these are part of the transaction process.

In the current pandemic era, the use of e-procurement will help companies to continue to carry out the Purchase to pay process effectively and ideally so that the process is faster. Due to its implementation, it can be done anywhere and anytime.

Using p2p software gives your company better visibility and flexibility.

 

Definition of Procurement and Purchasing

 

Procurement is the overall process for procuring or purchasing goods and is often referred to as procure to pay. The procurement process itself is divided into 3 parts, purchasing, expediting, and traffic.

 

The process starts from purchasing or purchasing goods which are continued with the supervision of the purchasing process so that it runs smoothly (expediting) and ends in traffic which is the last process for shipping and ensuring the goods arrive at their place.

 

Purchasing can be done alone without the need for expediting and traffic, if only for the procurement of goods in small quantities. This is usually done by offices who want to buy a number of items for office purposes.

 

Purchasing in bulk will require procurement followed by several processes. Every company needs to comply with this process so that the purchase of goods can run smoothly and according to procedures.

 

Procurement process

 

The procurement process is divided into several stages and the following are the stages of procurement of goods and their explanations:

 

Requirements determination

 

In the beginning, companies will make a request for the goods they need. Purchases of goods will be made based on the SOP for goods requests from each company or department.

 

Source determination

 

After making a demand for goods, the company looks for individuals or suppliers of goods or services. They will make an inquiry document to the provider of goods or services.

 

Vendor selection

 

The company will look for the right supplier. They will negotiate until an agreement is reached between the buyer and supplier.

 

Order processing

 

The company will make a purchase order that is already valid and given to the supplier for processing.

 

Purchase order monitoring

 

The buyer will monitor so that the buying process runs smoothly.

 

Goods receipt

 

The goods will be delivered in accordance with the purchase order that was previously made.

 

Payment

 

After the goods are received, the financial party of the company that purchased the product will make payments to the suppliers of goods in accordance with the agreement.

 

Problems that often occur in the procurement process

 

There are several problems that often occur in both procurement and purchasing. One of them, making documents that are still manual. This can lead to a stuttering purchase process or missing documents and result in slow financial reporting.

 

To overcome this, you need business software that can help you to create procurement documents digitally easily. Medius is here as a solution to this problem.

 

To optimize the ideal Purchase to pay process, there are five best practices that can improve the efficiency and effectiveness of the company's p2p process.

 

  • Implement Purchase to pay Software & solutions.

  • Maintain that all processes remain transparent.

  • Increase vendor involvement so that cooperation with vendors will always be good.

  • Optimize inventory.

  • Streamline contract management

 

Make your business smoother with Medius business software with complete business features for making financial reports and financial documents. You can make it only in one place, it's not complicated and practical.

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Daniel Zayas Daniel is a formally content writer last 4 years. I love to write finance, news, business, real estate category content. A writer by day and a reader by night, I have done my MCA from AKTU. I love coffee and tea. Top website to get backlink: Hesolite.com
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