Procurement is when services or goods or sold electronically. This generally uses an internet based platform. This process was designed to improve the efficiency and transparency of the process and help businesses save money. This method improves requests made over the phone, during meetings, email and through standard mail. In the past, there were issues regarding data visibility and process transparency. Current software has made the process efficient. Time is saved by the buyers, the data is easily centralized and accessed by management and past events provide the information for outcome visualization. 

The eProcurement software includes purchases made through ERP or enterprise resource planning and EDI or electronic data interchange systems. The most cost efficient tools are based in the cloud. This software is referred to as a SaaS or software as a service solution. This system is faster because it does not require any installations on the premises. The implementation is reduced from weeks or months to days or hours. The main reasons businesses choose this software are the improvement of process compliance and efficiency. This most often occurs for companies using traditional methods. Their purchasing power is increased and processes are streamlined. This leads to better oversight, less cycle time from request to purchase and an increase in the events per buyer.

Even companies with a clear process will benefit from this type of tool. When intuitive and flexible tools are combined with software based implementation, compliance is improved, cost savings increase, data management and visibility improve, transparency is increased for the RFT process and spending is optimized. One of the essential areas of procurement is strategic sourcing. Organizations are using strategic sourcing instead of tactical and reactive sourcing to provide the best possible functions. This satisfies the needs of the business marketing, the supply markets analytics and delivers the right solutions for the current needs. Studies have proved the best benefits come with the implementation for a tool for Esourcing. When this is combined with a process for strategic sourcing the savings are roughly a minimum of fifteen percent.

There are some challenges when implementing this type of system. This is because the company is essentially changing their management strategy. The key for achieving success with any major change in a business is the upper management. The values of the system must be communicated very clearly to the stakeholders beginning with the CEO and going downwards from there. If the proper authority is not received, making this type of change is a major risk and usually leads to high non-compliance issues. Implementation organizations once faced the problem of a high cost upfront for the necessary licensing, installation and training needed to understand how to use the tool. This is no longer an issue because the barrier of implementation has been substantially lowered by solutions for cloud based procurement. This enables even the smallest business to be able to experience all the benefits offered by this new technology.