E-procurement
E-Procurement is the process of business to business or business to consumer purchasing and selling of goods and services through the Internet. This can open up a whole new market for your goods or services to suppliers and customers from outside your normal trading areas. Large organisations are procuring goods electronically because it is cheaper to do so and they get economies of scale, within a few years smaller businesses will follow suit.
An alarm bell should have gone off in your head at this point. Local councils, the NHS and other major companies either are, or will very shortly only trade using electronic means. So, if you do not employ e-procurement in your business you run a very great risk in being excluded from lucrative contracts.
How does e-procurement affect your business? Some of the traditional face to face aspects of selling will diminish in importance, certainly in the early stages. Your existing relationship with a customer may no longer be guaranteed as companies implementing e-procurement search wider to find new suppliers. This increased competition will lead to tighter margins and you may find yourself being squeezed out.
All is not lost, however. The very process of e-procurement opens up new markets for you. It’s a new way in for you and your company to bid for jobs in sectors you may previously have felt excluded from.
Realigning your business to adopt e-procurement can be a challenging experience. However, practice makes perfect and once you have experienced the process, you will find it becomes second nature to do business the electronic way. In addition, there is no reason why your company couldn’t use the same e-procurement process to purchase your own goods and services – ensuring the best quality at the best price.