Businesses generally focus their procurement resources on the most critical buying categories and activities. However, significant savings opportunities exist within non-core categories as well. This is a significant area where procurement outsourcing can help as it delivers a "two-way impact" not only in the form of cost reduction, but also value creation.

Our sourcing outsourcing process relies on three fundamental domains:

• Total Spend Management: Spend optimization in total procure-to-pay process, including sourcing strategy


• Sourcing: Selected category management


• Transaction Processing: Transactional requisition to pay processes.

Again, our experience and research has shown that companies constantly battle with the "maverick buying" issues despite having made considerably large investments in strategic sourcing. Our model directly addresses this issue.

Sourcing activities include understanding client organisation's spend history and cycles, spend categories, and devising sourcing strategy. Generally for direct materials RFQ or RFP route is followed as there is no supplier discovery involved and procurement process a yearly contract with the supplier as a fall-out. For indirect materials, where price and supplier discovery plays a very important role, online Reverse Auctions are used.

The entire gamut of sourcing activities, whether it is online Reverse Auction (RA) or Request for Proposal (RFP)/ Request for Quotation (RFQ) is run on the dedicated application platform called Enterprise Procurement System.

Post Spend Analysis

• Supply Market Analysis


• RFP Development


• Supplier Evaluation (non-price)


• Price Negotiations/Online Reverse Auction Bidding Event


• Total Cost Analysis and Supplier Selection

At buyjunction, this process has evolved as a "best practice benchmark" because it eliminates time lapse in invoice expectation and amends on-time payment percentages. The Procurement RTP process increases visibility of transactions and includes remittance data with every electronic payment, helping improve business efficiency, cost savings. It also reduces day's sales and benefits from early payment discounts.

Salient Features
Online Requisition The requisition process is automated by using a web-based requisitioning system.

Approval Once a requisition is created the next step is approval which is taken care of by the RTP process.

Online Catelogues These catalogues store information as provided by the vendors and which can be updated on a periodic basis.

Purchase Order Once the requisition is approved, the creation of a purchase order takes place.

Online Receiving The process helps the receiving department in tracking returns, damaged goods, partial quantities, etc.

Online Invoices While creating the invoices, the vendor is able to view all purchase orders received at his end.

Since this model is a blend of three components, including sourcing, the services rendered involve various initiatives that are disseminated through our sourcing platform.

Services

• Helpdesk Service for Suppliers


• On-board new suppliers


• Monitor contract compliance


• Provide performance and quality and management