June 4, 2014, 3:29 PM

Beware the rise of better e-procurement technology

The more improved procurement software makes it easy for corporate purchasing agents to buy online, the more B2B online sellers have to ensure their sites are as easy to shop as consumer-facing retail web sites.

For those who have been practicing or just following B2B e-commerce for more than a decade, it doesn’t seem that long ago when there was much excitement about the new age of Internet-based procurement systems. Enthusiasts said they would change the way companies purchased the products, materials and supplies they needed to conduct business.

But though early e-procurement providers like Ariba, now part of SAP AG, are still offering value while expanding their range of services, e-procurement systems haven’t always won the hearts of the increasing number of corporate purchasing agents going online to buy the products their companies need. With many of these buyers accustomed to using shopper-friendly e-commerce sites instead of what can be relatively dull and difficult-to-shop procurement systems, they’ve often been lured away from the company’s approved suppliers by more image-rich and easier-to-shop e-commerce sites operated by companies outside of the buyer’s company’s approved list of suppliers, notes Forrester Research analyst Duncan Jones.

But that’s beginning to change. As Jones describes in a recent report on procurement system providers, a number of them are offering far more shopper-friendly applications. This newer software not only let buyers more quickly find what they need with better imaging and site search and navigation, but also routes planned purchases for approvals among designated managers and maintain records of purchase orders, invoices, inventory levels and spending budgets. That allows chief procurement officers to maintain control over the entire procurement process while also making shopping easier and faster for the employees placing the orders.

As a result, for B2B e-commerce catering to these buyers, it’s more important than ever to offer sites that let business buyers quickly find and purchase what they want, while also providing integration with back-end accounting and inventory management systems to keep the bean counters happy. One option more companies are considering is the use of punch-out systems, which let buyers in an e-procurement application navigate to a supplier’s image-rich and fully functional e-commerce site to find what they need; when they click to buy, their order is kicked back to the procurement application to get purchasing approvals. The procurement application also ensures that the purchase is routed to the accounts payable systems for generating purchase orders and other applications for updating financial and inventory records.

E-procurement systems and e-commerce sites have each come a long way in the past 15 years. And to keep up with the ongoing changes, B2B companies that want to stay in the game need to keep evolving as well.

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