The procurement and sourcing processes involve the ways in which goods and services are bought from business suppliers. Many people confuse the terms, or use them interchangeably, but they are not the same.
Procurement is an end-to-end process that includes sourcing, managing the internal workflows for submitting purchase requisitions, creating and sending purchase orders, and managing deliveries and payments. Sourcing involves actually finding, vetting, negotiating and contracting with suppliers.
Both procurement and sourcing are a part of supply chain management, which involves the entire process of managing products and services purchased from suppliers—the procurement process—along with building the business’s own goods and services, and moving them among different parts of the business and ultimately to end customers.
In this article, we’ll explain:
What is procurement?
What is procure-to-pay?
Procure-to-pay does not include spend-management, sourcing of the goods, or production planning or forecasting. Procure-to-pay includes only the steps that can be automated with software.
Streamlining procurement operations to avoid error and bottlenecks
Using software to automate parts of the procurement process will ensure consistency, efficiency, and cost-effectiveness. It also is a scalable solution that can enable the procurement department to manage large operations without having to increase staff to handle all the moving parts.
Sourcing is the initial process of identifying, analyzing, and negotiating with suppliers of goods and services. Typically, the goods and services sold by these suppliers are needed for a business' day-to-day operations, and the pricing and quality of the goods are critical to operational success.
Pipefy's automated workflows can handle repetitive, time-consuming tasks, and help teams communicate effectively. When you need to take control of your finance department and procure-to-pay process with the big picture in mind, Pipefy is the perfect partner. Reach out today to learn more. Try Pipefy for free today or request a demo to supercharge your finance and procurement operations.
Procurement is the end-to-end process of sourcing and obtaining goods or services needed for ongoing business operations.