Best Procurement Software in 2024

What is Procurement Management Software?

Procurement management software helps businesses in managing their purchase cycle and allows them to track their inventory at all levels. Procurement software automates the material purchase process and maintains an inventory of goods. eProcurement software is used to generate purchase orders, execute new orders, match invoices, and pay bills electronically.

Procurement management software helps in making the administration process easy and saves a lot of cost and time. With procure-to-pay software, you can collect and analyze inventory-related information and streamline activities related to purchases and orders.

Preventing spot shortages and executing financial transactions are easy with cloud procurement software. Managing the online ordering process, generating purchase orders, matching invoices with receivables, and paying bills electronically are key functional areas of procurement software.

Procurement managers can track and manage different vendors efficiently and stay updated about the terms of the contract, rates of procurement, negotiated price, etc.

What is eProcurement Software?  

eProcurement software is a cloud-based solution for enterprises that helps in defining vendor policies and managing the entire procurement cycle digitally. eProcurement software helps in fastening the approval process and brings transparency to the overall spending. Further, you can track and manage the supply chain process with higher transparency.  

What Does procurement Software Do? 

Procurement software is used by organizations to automate the entire process involved in procuring materials and maintaining the stock of raw materials and equipment. Procurement software helps with generating PO (purchase orders), tracking the materials procured, and generating the bill of material.

Generating POs: Procurement system software helps with the instant generation of purchase orders and sending them automatically to suppliers.

Creating approval workflows: Procurement system software provides department and custom-wise workflows for managing the delivery of goods and services.

Ensuring procurement process compliance: Procurement management software helps create a compliant procurement process as per the government guidelines.

Providing procurement system controls: The procurement management system helps connect with the right vendors for procuring goods at optimized costs.

Creating centralized records: Get centralized information for all processes right from procurement to pay.

How Does Procurement Software Work 

Procurement software helps enterprises in managing the following activities: 

1. Creating and verifying the purchase order 
2. Sending the purchase order for approval 
3. Electronic transmission of the purchase order 
4. Sending reminders to acknowledge & confirm purchase orders 
5. Maintaining inventory and preventing spot shortage 
6. Analyze the procurement process to improve productivity 

Most Common Features of Procurement Software

With eProcurement software, you can collect and analyze procurement-related details and streamline activities related to purchases and orders. The program helps you maintain a good relationship with vendors with pre-defined terms of service, negotiated rates, and so on.

Requisition Management: Requisition management software allows you to create, track and process purchasing requests in an organization. The purchase management system helps you with requisition management through process transparency, inventory optimization, and actionable insights.

Supplier management: With procurement software, you can communicate with suppliers in real-time to directly control and manage supply. You can also share supply and payment history, address location and contact information.

Catalogue management: Procurement software helps you in creating and managing a digital catalog of goods and products in detail. It provides other details such as product description, specification, and pricing.

Invoice processing: The procurement management tool allows you in managing supplier invoices. It also helps you match the invoices with goods received and helps make payment accordingly.

Purchase order management: The software helps manage the purchase order cycle, starting from issuing orders to procuring products and goods, to making payments; the eProcurement software helps you manage everything.

Contract management: Sourcing management software handles the entire contract lifecycle. The centralized repository helps manage contract administration by tracking savings, compliance, and performance.

Sourcing: The sourcing dashboard attached to the procurement management system offers a 360-degree view of different sourcing activities. Procurement software helps companies in sourcing inventories using its supplier intelligence and collaborative authoring.

Invoice Processing: Procurement software solution captures payment-related data, and automatically generates invoices. It can further generate invoices on purchase orders, match purchase orders with the inventory received, and optimize your invoice processing workflow.

Purchasing Software: Processes like creating purchase orders, streamlining negotiated prices, and ensuring compliance with policies, everything is done with the purchase module. Procurement software can also generate purchase orders with no physical intervention.

Procurement Analytics Software: Procurement system software also provides the analytics tool to make exact and accurate decisions. Analytics tools can also be useful for making data-based purchase decisions at competitive prices.

Spend Management Software: Procurement tools software also acts as a spend management software. It helps with activities like sourcing, purchasing, and payments. With procurement software, organizations can control how much they spend on each division.

Procurement and Inventory Management System: Procurement software can also be used as an inventory management system. A procurement management system helps in keeping records in multiple formats. Procurement software also allows agents to monitor relevant information. Procurement software includes information about the products and the number of items present in stock.

Procurement SaaS: Procurement SaaS or e-Procurement software is the most popular version of procurement software. Data stored on the cloud is owned by the customer and hosted by the provider. Automatic updates are provided and there is no need for customers to have any particular hardware specifications.

3-way match: Matching from purchase orders to receipts to invoices in real-time is done using the 3-way matching feature. Procurement management systems also help with order revisions and discrepancy tracking as well as checking supplier invoice tolerance rates.

User management: Procurement software tools support single sign-on and two-factor authentication for easy user management. The platform also helps with setting user access and restrictions.

Reporting: Procurement software generates multiple reports to track and analyze the procurement cycle and find loopholes. 

What are the Core Functionalities of Procure to Pay Software 

Controlling procurement processes for staying on top of all orders is possible with the procurement management system.

Order and purchase spend management: Procurement software provides order and purchase management capabilities to reduce the administrator's workload. The centralized catalogue system helps with efficient order management processes. Its purchase management module provides insights into all transactions as well as commercial compliance.

Improved supplier management: Procurement management systems can handle the supply cycle of different goods and products effortlessly. Further, the software helps with segmentation and on-boarding processes. Also, IT procurement teams can access the entire supplier data.

Compliant purchasing: The compliant purchasing feature of procurement software helps in streamlining both purchase order operations and purchase requisitions. The feature helps organizations in making direct purchases from authorized suppliers every time the need arises.

Standardized contract lifecycle: Procurement software is used by contract reviewers for checking deviations in a contract during the early negotiation stage. Businesses also receive automatic notifications and alerts every time a contract is about to expire. 

Benefits of Procurement Management Software 

Procurement Management Software helps in simplifying the business operations with smart procurement handling tools.

Transparent spend analytics: Transparent spend analytics is a critical feature in improving a company's business strategy. The feature helps you identify the areas where you can cut costs in terms of procurement. You can also use the feature for assessing the best deals that have been made so far. Such data helps businesses in negotiating better for upcoming deals.

Reduced cost: By supporting the electronic transaction, procurement software brings down paper-based workflows. The software helps digitally save copies of a purchase orders without acquiring much space.

Shortened business cycle: The cloud procurement software simplifies digital purchase orders and sends a digital copy of the purchase order. With the software in place, you don’t need to send purchase orders or bills offline such as couriers. As a result, the overall procurement and supply chain process is fastened.

Inventory control: With procurement software, you don’t have to manually track and monitor all goods and items available in the stock. Businesses that use procurement software can auto-calculate inventories and ensure sufficient stock quantity so that an uninterrupted supply chain can be managed.

Transparent spending: Procurement tools help enterprises in keeping a detailed record of the buffer stock, purchase orders, and billing invoices. When visual data representation, procurement software brings transparency in accounting books.

Streamlined procurement cycle: The entire procurement cycle starting from managing contracts to sourcing suppliers, handling purchases, etc., can be managed by procurement software providers. Further, you can use the procurement software to elevate the performance of your procurement team, enhance your strategic reach and accelerate digital transformation.

Efficient collaboration with suppliers: Procurement software helps you easily collaborate with suppliers by checking their past performance records and detailed profiles.

Real-time sourcing auctions: Procurement software solutions provide you with safety nets and extension rule strategies for organizing successful auctions. With this feature, you can create an auction and start bidding in real-time to start the process.

Budget control: Monitoring the expenditure of all sourcing projects and streamlining those are easy with the purchase management system. The application centralizes the financial data for easy purchase as well as approval workflows. With the best procurement software, you will not just link budgets to spending but can also look after different budget types such as capital, operating, and project/contract-based.

Documenting transactions: Procurement management software documents all transactions so that complete information is available regarding the spending done on vendors. The software can also be trusted to assess both cost quality and the time required to complete a purchase.

Things to Consider When Buying Procurement Software 

A range of functionalities suited for businesses of all sizes is what defines procurement software solutions. Let us have a look at a few metrics that should be considered for choosing the best procurement software.

Standard operating procedure: Standard operating procedure or SOP is mandatory for carrying out complex tasks while ordering the inventory. The best sourcing management software helps document the standard operating procedures for all such complex activities. This feature also reduces the possibility of miscommunication and ensures uniform performance across departments.

Approvals and requisitions: Simplify approval processes using cloud procurement software that configures workflows and an email-based notification system. Through requisition support, you can simplify complex approval processes and follow the automatic routing procedure. 

Supplier audits & second sourcing: Supplier audits and second sourcing help businesses work towards the outcome they are expecting from their daily operations. For this purpose, supplier audits are being used to verify targets and expectations that have been met so far. With this feature, you can ensure that the quality is never compromised. Second sourcing is a kind of insurance system which is relied upon for meeting unexpected situations.

Category Management: Purchase management systems categorize products into groups based on characteristics and traits. This database of products is available to departments across your office. 

How much does procurement software cost in India? 

Procurement management software cost in India starts at as low as Rs.1000 with standard features. Procurement software price further varies based on the customization required by clients.