Everything You Need to Know About Procurement Issues & Their Fixes
Let’s face it; every business faces procurement issues at some point in time. Many struggle to reduce their material and service costs. On the other hand, some businesses are left at the mercy of suppliers who have a longer lead time or low-quality materials. Finding high-quality vendors is a challenge, as well.
Due to the use of ineffective tools and poor processes, some companies face communication and documentation issues too. These problems could result in huge losses and an increase in the possibility of procurement fraud.
A poorly managed procurement process can increase your costs by up to 5 times. It can also result in the mismanagement and wastage of man-hours. In fact, companies in the US and Canada lose nearly 32 million man-hours every year due to this reason. Inefficient processes and manual data entries are one of the biggest challenges faced by 48% of these companies too.
Now that you know the most common procurement issues faced by businesses, let’s look at how you can solve them.
Due to the use of ineffective tools and poor processes, some companies face communication and documentation issues too. These problems could result in huge losses and an increase in the possibility of procurement fraud.
A poorly managed procurement process can increase your costs by up to 5 times. It can also result in the mismanagement and wastage of man-hours. In fact, companies in the US and Canada lose nearly 32 million man-hours every year due to this reason. Inefficient processes and manual data entries are one of the biggest challenges faced by 48% of these companies too.
Now that you know the most common procurement issues faced by businesses, let’s look at how you can solve them.
fixing procurement issues
It’s only natural that you need to change your processes to fix procurement issues. One of the best ways of going about it is by automating things.
Automation can help you remove human error from the equation. At the same time, it can help you streamline your complete workflow and automate simple tasks. Not only will this reduce errors but also save you some valuable man-hours.
Automation also means that your data will be easily accessible to your team. This transparency can make it easier to prevent procurement fraud and data duplication.
In fact, automation can reduce your errors by nearly 40%. Additionally, your cost-per-invoice can decrease by almost 90% too. You may also be able to reduce the invoice exception rate to as low as 10.7%.
Automation can help you remove human error from the equation. At the same time, it can help you streamline your complete workflow and automate simple tasks. Not only will this reduce errors but also save you some valuable man-hours.
Automation also means that your data will be easily accessible to your team. This transparency can make it easier to prevent procurement fraud and data duplication.
In fact, automation can reduce your errors by nearly 40%. Additionally, your cost-per-invoice can decrease by almost 90% too. You may also be able to reduce the invoice exception rate to as low as 10.7%.
To understand more about procurement issues and their solutions, you can check out the
infographic below by PurchaseControl.
infographic below by PurchaseControl.
Image courtesy: PurchaseControl
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About The authorMichael is the Founder & CEO with international experience in Procurement and Spend Management Software – ‘PurchaseControl’
https://www.linkedin.com/in/michaelhiggins-purchasecontrol/ |
