The multiple fold increase in the number of internet users over the years has resulted in enhanced global connectivity. This has also increased the number of businesses and the transactions which take place online. This involves both buying and selling over the internet. The internet generation today is well informed than it was in the yesteryears. It is possible to find about everything on the go just with a search. Nowadays, there also have been several advancements when it comes to the ways we search. We have several search engines (Google, Bing, Yahoo, etc.), voice search assistants (Siri, Alexa, Cortana etc.), QR code scanners and Google lenses to cater to our curious minds.
With increasing innovations in the technological domain, the efficiencies of the processes have increased, and it is now possible to optimize them to a level that can surpass the expected outcomes. Artificial Intelligence in this era has penetrated our lives in a way it had never before. Online shopping, browsing, searching, retail, healthcare, transportation, and many more sectors have AI entrenched to provide a variety of services and additional functionalities, which have enhanced the user experience and the efficiency of the products or services offered by the different sectors. This has led to the scope of automating the businesses and has reduced the need for human intervention significantly.
Need and importance of e-procurement
When it comes to buying and selling of goods and services over the internet between businesses and consumers, it is known as e-distribution. The nature of transaction here is direct as in the case of e-procurement, and the consumers are assured about the authenticity of the transactions.
Let us now look at five reasons due to which e-procurement and distribution can be considered as the next big thing in the future:
The tools which are built-in the systems for the process of e-procurement and e-distribution help to maximize the performance and reduce overheads as well as manual work. The processes are streamlined due to the automation, and due to this, it significantly reduces the overhead costs as well as the administrative costs. Since the materials are ordered time and again from approved vendors, and every process happens through the web portals, the whole process does not demand constant inspection and attention.
Since it facilitates global connectivity and worldwide shipping is quite possible now, the market reach will be increased tremendously for both buyers and suppliers in this case. It will be easy to find out multiple buyers and sellers offering quality products at their best prices. It is also possible to compare the available options and choose the best fit. In case of distribution too, consumers would be able to order from anywhere around the world sitting at their homes through their smartphones.
Since the processes are conducted online, the information is stored in servers or databases and is completely secured. Every small detail right from the name and address of the supplier to the time of order and mode of payment can be traced and found out. This improves the transparency of the process as well as increases the trust of the sellers and buyers towards each other as well as towards the system. This leads to a cordial relationship and serves as a strong foundation for the businesses.
The transactions involved are centralized. Various functions like tracking of reports, payments, orders, quotes etc. are possible with e-procurement systems. These functions have successfully reduced the delivery time of the orders and made the duration of the purchase cycle significantly shorter.
Since everything is digitized, it is possible to forecast demands and supplies on the basis of past order patterns. With the application of artificial intelligence and machine learning, data analytics has become extremely advanced and accurate. The insights obtained from the past data can help manage the inventory. For example: if the forecast says the month of summers has a higher demand for milk solids to produce ice-creams, the manufacturers can get their warehouses stocked accordingly to meet the projected demand a well as to earn more profits.
E-procurement and distribution can be integrated into systems as softwares which are provided by large (ERP) Enterprise resource planning companies.
To optimize the mechanisms of supply chain and eliminate unnecessary manual work and paperwork, companies are shifting towards the online mode of supplier exchanges. Due to the evolution of the internet as an important channel for e-commerce, the concept of e-procurement is drawing attention due to its various advantages. Due to its capacity to reduce manual errors as well as operating costs, e-procurement and distribution systems have started to be implemented by several companies. The procurement trends have varied greatly over the years and recently have undergone tremendous changes.
In today’s world, staying into the market and sustaining the competition requires the market players to have the adaptability to accept anything that can improve the efficiency of the business processes and the one that can reduce the costs at the same time. Offering several advantages, e-procurement and distribution surely have a great scope for the online market players of the world in the time ahead.