E-Procurement Literature review Example | Topics and Well Written Essays - 1750 words

E-Procurement - Literature review Example Usual methods of procurement have lots of paper work processing, which requires a huge amount of money and time. E-procurement has reduced this work largely. E-procurement is a chief element of B2B ecommerce and it can be used in markets and industries in wide range. Business organizations buy many products of diverse varieties, ranging from paper clips to computer systems and from steel to equipments. They buy raw material inputs, which directly go in manufacturing process and the raw materials that need some repairing and maintenance before going into manufacturing process. There are thousands of other items purchased by an organization and keeping their receipts in record is very necessary for organizations to maintain professionalism. The main driver of e-procurement is cost-reduction attained from competencies resulting in less staff time spent in looking for and ordering products and integrating deliveries with invoices. Savings also take place with automatic corroboration of p re approved expenditure budgets for individuals or organizations leading to less time necessary for processing each order (Turban, pp.251-252, 2010). Automatic ordering, delivery, confirmations, payment, and inventory information diminish paper work, costs of paper-based ordering forms, storage space for credentials, records, and better information management. Indirect benefits of e-procurement include a shorter cycle time between order and use of supplies, greater suppleness in ordering products from different suppliers, amplified buyer productivity, and lower prices through product standardization and union of buyers (Havaldar, pp.379-382, 2010). Benefits to buyers of e-procurement include gain from improved pricing of goods and services, cost savings in the running of procurement processes, merger of buyer's sub entities into a single buying unit, and minimized costs through purchasing aggregation for some items. Other intangible benefits include enhancement in operations support , employee efficiency, evident purchasing behavior of business partners and supplier performance. Decline in procurement-to-pay cycle time and costs associated with outsourcing procurement and it helps maintaining smooth procurement operations. It also causes huge savings in invoice, finance, goods insurance, and delivery (Gay, Charlesworth & Esen, pp.474-475, 2007). Conversely, suppliers benefit from lower managerial costs, use of standard online catalogues that can be quickly updated with new product information, more effectual targeting, and access to a wider range of buyers (Babin & Weiss, pp.89-91, 2009). Additionally, lower inventory and warehousing costs are also the advantages of suppliers. Other opportunities contain lesser advertising, selling and service costs, extended product and service offerings, enhanced cash flow through better inventory returns and accounts receivables, a more thorough anticipation about a buyer's purchasing needs, and immediate responsiveness to a buyer's needs (N, pp.28-29, 2004). Nevertheless, for each e-marketplace contributor, the benefits will differ according to the contributor’s position. As buyers go for e- procurement, suppliers may not have any other option rather than joining in. The majority of suppliers are also buyers; therefore, net result is an increased involvement in e-procurement. E-procurement offers benefits in many