What is eProcurement?

eProcurement is a collective term for several technologies that assist with more efficient and effective procurement. It generally consists of any of the following attributes:

• A “requisition-to-pay” workflow system, which is the process of raising a purchase requisition through to making payment to suppliers. This most often integrates with incumbent ERP systems;
• eSourcing, which is comprised of the tasks of developing the procurement documents, issuing and receiving procurement documents and automating the evaluation of responses and may also include reverse auctions;
• eMarketplace, which is an internet-based facility that enables trade between one or more buying organisations and their suppliers; and
• Purchase cards, which are similar to credit cards and can be used to purchase goods or services.

Potential Benefits

• eProcurement takes all the benefits of the conventional procurement process (fairness, transparency, accountability, etc.) and allows for the reallocation of scarce dollars to front-line service delivery. This is achieved through:
• Reduced cost of goods and services;
• Potentially improved coordination between smaller communities and members of the local public sector as they collaborate to achieve the benefits of e-procurement;
• Savings of up to $30 to $100 (depending on the buyer's processes and the scope of the solution), or more, per transaction are possible when many jurisdictions conduct tens, if not hundreds, of thousands of transactions annually; and
• Assisting the local economy to become more “e-commerce ready” through their interactions with the public sector.

Leading Precedents

The Canadian public sector has a window of opportunity to join other leading jurisdictions in the implementation of an e-procurement program.

• The United Kingdom. There are now over 150 rural and urban local buying organizations, including universities and hospitals, participating in 5 e-marketplaces throughout the country.
• The Scottish Executive. 60 rural and urban public sector organisations and 16,000 suppliers are currently signed up to using the e-Procurement Scotland service. The total value of orders through the system is approximately BPS2 billion since 2002.
• Denmark. The Danish public e-procurement portal is a public private partnership with Gatetrade, which is the largest B2B online marketplace in Denmark, with more than 3 million commodity lines and over 1200 different companies.

eProcurement Consulting

The Procurement Exchange can assist your organization with its eProcurement strategy. This may include:

• Conducting "as-is", "to-be" and "gap analysis" assessments;
• Training on the e-procurement marketplace and analytical techniques to complement internal projects;
• Benchmarking of existing activities to international practices; and
• Change management and supplier engagement strategies.

Contact us to learn more about the services that The Procurement Exchange can offer.

• Online RFx Development