E-procurement and its growing importance in the Indian market!
1. Define E-procurement in your own words.
In simple words, Electronic procurement is a business to business (B2B) process of purchasing and selling goods or services over the internet. It offers a highly customizable digital platform that is way more transparent, secure, standardized and efficient when compared to traditional methods of procurement. It automates the complete procurement cycle, eliminates the paperwork, improves transparency, mitigates risk, works within the legal boundaries, and brings visibility in the spend thus resulting in cost saving.
2. The role & benefits of E-procurement in this 21st century.
E-procurement solution massively adds value to an organization by streamlining and standardizing the procurement process. The management’s life gets easier as automation saves them from repetitive and tedious processes. It improves transparency and also reduces the risk of fraud and corruption by providing a clear audit trail and features such as sealed bids. E-procurement system provides real-time alerts and also helps in keeping relevant information neatly documented and time-stamped to improve the decision-making process by gaining meaningful insights. Accelerated delivery is the main benefit that should be sought by streamlining the procurement processes. Concisely it helps businesses to reduce expenditure, mitigate risks and save time.
3. How E-procurement can benefit/is benefitting the start-up eco-system in the country?
The requirement of e-Procurement solutions is not industry-specific. Large, midsize and growing companies across all industry verticals that need cost savings will certainly benefit from the e-procurement system. E-procurement eliminates the cost of procurement resources and empowers the organizations to achieve efficiency, transparency, and effectiveness in procurement.
As far as the start-up ecosystem is concerned their obligations are to fast track the growth, reduce maverick spending, build a network of buyers and suppliers, cut expenditure and attain a better ROI with conforming to legal boundaries. India’s market is populated by middlemen which results in inflating the costs which reduce the profit margins, but an e-procurement solution takes care of the issue by eliminating them. Since start-ups have a limited budget, an e-procurement solution helps them in all verticals of business by providing a secure customizable platform which not only provides a pool of suppliers but also helps them by minimizing manual work, documentation, risks and various costs involved in the procurement process. There is a famous quote by B. C. Forbes “If you don’t drive your business, you will be driven out of business.” The e-procurement system is being adopted and embraced by the business world and start-ups are no different. As far as cost is concerned with adopting an e-procurement system the initial investment is outweighed in the long-run.
4. Advancements and technological developments required in the E-procurement process to make it feasible for Indian businesses.
The Indian market has always been price competitive. In recent times cloud has been an integral part of turning big data into meaningful insights. Cloud-based data management has made it easier for businesses of all sizes to flawlessly integrate software and hardware to create a unified data environment. Though there is an initial investment required to set-up an in house cloud-based system and another option is to outsource. Cloud-based systems help in saving various costs such as maintenance cost of servers, 24*7 electricity, installation of various components, turbo cooling fans, workforce, etc. The savings in various other departments can further bring down prices and attract new clients. Other technologies that are being integrated with the e-procurement systems are data analytics, artificial intelligence, and machine learning. These solutions provide low-cost options and the rapid deployment of services. So such technological developments in e-procurement will help Indian businesses to tackle new problems with ease and more efficiency. As more and more businesses will adopt the systems with respect to continuous technological developments, it will get more feasible for the Indian market.
5. The E-procurement scenario; India vis-a-vis the world.
E-procurement is growing at an accelerated pace. Recognizing the remarkable growth records, the market perceives, Market Research Future (MRFR) in its recently published study report asserts that the global procurement software market is expected to reach USD 9.9 Bn. by 2023 registering approximately 10% CAGR from 2017-2023. The procurement software market is dominated by the North American region with the largest market share. The factors contributing to the substantial growth are the high adoption rate of cloud technology, government backing, well-established infrastructure which allows faster implementation and raging demand by some of the burgeoning sectors such as BFSI, Healthcare, Media & Entertainment, and IT & telecommunication.
Growing markets of APAC countries are also giving tough competition and attracting big players. India is one of the key players driving the market growth, attracting the international players in the region. The high demand and adoption rate is the subsequent result of integrating new technologies and keeping the price affordable compared to global products. Opportunities are in abundance as it’s a growing industry and the emphasis on maximizing return on investment (ROI) and value creation, backed by minimal waste and expense, will remain a top priority for the e-procurement industry in India.