It’s important to learn the procure-to-pay process and the automation systems as it will help you manage it if you own any type of business, whether standard or online.
Your procurement and accounts payable managers should be capable of analysing the flow of a transaction at any moment, from the date an item is ordered through the time an invoice is cleared.
What is the procure-to-pay process?
Businesses use the procure-to-pay procedure to ensure efficient procurement. It entails connecting accounts payable and purchasing software so that each aspect of the procurement cycle may be conveniently managed.
Procure-to-pay, at its most basic level, entails four fundamental phases, each of which is monitored and visible to clients:
Purchasing products and services and submitting an internal demand.
Examining orders and confirming that they are in accordance with business standards.
Getting the product and confirming that it corresponds to the actual purchase demand.
Handling the invoice from the provider and matching the payment in accounting software.
Benefits of Procure-to-Pay
Procurement and accounts payable can both benefit from automating to their procure-to-pay operations. Here are just a few examples of the benefits your firm will experience.
E-procurement and P2P technologies can help you allocate your procurement teams, increase expenditure planning, and even control your supply network.
Streamline procurement processes – Procurement software connects the entire organization, allowing requisitions to be submitted and authorized more quickly, relevant vendors to be picked according to data, and POs to be created and sent to suppliers. Everything is done online and is easily traceable.
Reduce invoice processing costs by up to 80% – Becoming paperless saves time and money, allowing businesses to focus their resources on more strategic objectives rather than monotonous operations that could be automated.
Get 100% visibility –A P2P solution gives real-time insight along the supply chain, allowing buyers and vendors to see invoice progress.
Leverage negotiating power – When suppliers are confident in their payment details, they may be ready to provide consumers more favorable conditions while still guaranteeing that suppliers have the funds they require to expand their organization.
Features of Procure to Pay Software
Procure to pay software oversees all areas of a company’s procurement cycle, including requests, buying, receiving, payment, and properly accounting for products and services acquired. Here are the some main features of Procure to pay software:
Supplier Maintenance: Organize and manage your supplier connections. Incorporate your suppliers into the network, gather outstanding data, assign bills or receiving POs to various suppliers, manage supplier risk, and optimize the businesses with whom you collaborate.
Vendor Database: Look up vendors and decide which ones to buy from. Vendors can be chosen by risk rating, cost, area, and other factors.
Approvals: Keeps track of your purchase requisitions. Allow individuals to make product purchasing recommendations. Requests should be sent to management for authorization. Vendors will be notified after your requests have been confirmed.
Purchase Orders: Make purchase orders that are specific to the products you want to buy. For quick delivery, deliver to a suitable supplier.
Inventory Management: Receiving and delivering from purchase procedures are managed. Once orders are received, add them into your stock. Make a list of any leftover charges that must be paid to vendors and suppliers.
Invoicing: Prepare invoices to be paid by your accounting team and match them with purchasing orders. Charges are accurately coded and linked to any organizational budget.
Contract Management: Automate contract operations and gather important finance and purchase information.