Procurement is an important business process in the value chain and involves the purchasing of goods and services from suppliers at an acceptable quality and price and with reliable delivery.
Electronic procurement (E-procurement) refers to the use of ICT (Information and communication technology) enablement of key supply chain activities. It is specific feature of B2B e-commerce.
E-Procurement is the purchasing of product components, standard raw materials, customized supplies and other goods needed to conduct business operation.
The process includes 12 steps as show in follow:
Recognize the need: The employee should identify the need for goods or service.
Access to electronic procurement application: Employee access to browser-based procurement application includes user profile (allows the users to access catalogues, item and services that authorized for use)
Entrance buying catalogues: The electronic catalogue allows the user to achieve compound searches and to construct the goods for objective.
Select the item and make request: When the employee selects the goods from catalogues, a request is make in any one of several potential format.
Approve the request: If approval is required, the request run through a work flow process, or possibly going through various levels of authorization. Also, managers can approve or reject the request on the Web using the browser interface.
Build a purchase order: e-Procurement application interfaces with the server to create and record the order. Upon approval of the request, e-Procurement system also produces the order, combines the request with other request for similar products from the same seller, or divides the request into various purchase system to different seller. The purchase order will record in the company database or accounting system.
Process the purchase order: The purchase order possibly transfers to seller in many different ways, such as Electronic data interchange (EDI) over a proprietary value-added network (VAN); by the use of fax or Internet as e-mail or extensible markup language (XML) formatted messages.
Seller receives the purchase order: If the purchase is received by EDI/VAN or XML, the seller's system will automatic to records the document. However, if received by fax or mail, it will need the human to process.
Query request the status quo: The employee uses the browser to ask about the status of purchasing order. For example, enters the purchaser order number that checks the seller's update detail for the goods.
Product shipped: The seller will ship the goods and shipping notice to the company. When the company receives the goods, it might make an evaluated receipt settlement (ERS) ...