Procurement is the very first step in any organization’s supply chain. It’s thus crucial to get this step right to ensure that all others can be completed in time.
Doing it correctly can help you reduce your costs and also speed up your operations. However, many organizations still end up facing procurement problems.
Some of the common procurement issues that companies can face are:
- Struggle to reduce the costs of their materials and services. Many companies face this issue because they’re not in control of the market rates and other supplier charges.
- Low-quality incoming materials and higher supplier lead times can be major challenges for companies.
- Inefficient processes that rely on paperwork can lead to less transparency. This can result in duplicate payments and procurement fraud.
Due to these problems, businesses in the U.S. and Canada lose about 32 million man-hours every year. In addition, poor processes can lead to the ballooning of your expenses. Your costs may increase by almost five times due to them.
The problems can multiply when you don’t have a centralized system to track your accounts payable. This is the case with most small companies, and that’s why nearly 29% of them have been victims of billing fraud in the past.
To solve these issues, you need to automate things. Let’s take a look at how automation can help you.
Solutions Through Automation
You should consider automating repetitive and simple tasks so that you can reduce human errors. In addition, automation can help you make the procurement process more transparent. As a result, you’ll be able to reduce the chances of fraud. In addition, the invoice exception rate can be reduced to 10.7% by automation.
To figure out how you can incorporate automation into your procurement process, and how it can help you, check out this infographic by PurchaseControl.