eSourcing, sometimes referred to as electronic sourcing is the process a company uses to procure goods and services from suppliers with the ability to compare them side by side based on quoted pricing or capabilities in order to choose a preferred supplier based on data. This process is typically carried out on a digital procurement platform such as oboloo.
Newer cloud-based procurement software is designed to be user-friendly and therefore allows companies to create eSourcing activities in minutes rather than hours or even days, generate savings based on live data and increase visibility of supplier performance.
What is the eSourcing process?
eSourcing is a key part of the eProcurement process however it is also heavily reliant on other processes such as Supplier Management. eSourcing is the process of finding, evaluating and deciding which supplier to collaborate with based on their responses to a tender. An eProcurement solution will gather supplier responses such as pricing and answers to questionnaires and will analyse the results in a user-friendly dashboard, offering users clear and accurate information directly from their suppliers.
1) Request for quotations (RFQ): The process wherein the buyer sends out forms to suppliers in the same industry, asking for the prices of their products or services and responses to specific questions. Questionnaires may also be known as pre-purchase questionnaires (PPQ) which are designed to access a supplier on their suitability to provide goods or services as well as establishing if they hold similar values to your own company’s.
Prior to cloud procurement technologies, companies had to manually create these documents on software like Microsoft Word or Excel and send them by email to suppliers one at a time. Chasing suppliers, collating their responses, transforming them into a standardised format, and analysing their responses would normally take days or weeks.
2) Evaluating responses: The process where the buyers assess which of the suppliers’ proposals are viable for them. The software will consolidate all the returned information from the suppliers to make this is simpler.
3) Contract awarding and management: The supply deal is awarded to the successful supplier and contract terms agreed upon. The on-going management and monitoring of the supply can also be completed within the system.
Benefits of eSourcing
Companies invest in e-Sourcing software because of the following benefits:
- Provides transparency — eSourcing is specifically designed to help both the buyers and suppliers. From the buyer’s perspective, the software allows them to see all the key information they need to know about the supplier and their products or services. The two parties can easily see the process status or the deadline. That makes the process smoother and more transparent.
- More manageable processes — Since everything about the process is transparent, checking compliance and missing documents are faster to track. It also makes following any regulatory procedures easier to accomplish.
- Helps your organisation get the best value — eSourcing can help you see all your supplier options at a glance. By referring to your data, you can easily recognise which service provider fits your budget.
- Saves you time — From creating an activity to awarding it to a supplier is a simple, proven process that is all within the system. Valuable records are created that can be referred back to any time.
Today’s fast-paced world requires organisations to have the right tools to help make their work more efficient and effective. For the finance, procurement, and purchasing teams of any company, having e-Sourcing software is a game-changer that will benefit the whole organisation. Consider getting one for your team.
Do you need e-Sourcing software for more efficient work? oboloo is the smarter way to take control of your sourcing activities. Start your free trial today or book a free demo to see how this cloud-based sourcing program can help you. www.oboloo.com