22 Best Purchasing Software in 2021

What is Purchasing Software?

Purchasing software is an automated business solution, helping organizations with the procurement process. Purchase order software is critical for comparing and finalizing suppliers within your budget, comparing their products, and finally procuring goods and services.

Purchase order software provides many useful features to create digital purchase orders, manage invoices and acknowledgement receipts. Purchase order management software further helps with invoice reconciliation for suppliers, and contracts management.

Types of Purchasing Software

• P2P Suites 

Procure to pay suites have been designed to look after a business' procurement activities and other activities like contract management, strategic sourcing, inventory, and supplier management. P2P suites often support cloud-based deployment.

• ERP Suites

ERP suites comprise procurement modules along with the features for production planning and control. These tools aren't much user friendly as they have limited features and lack contextual dashboards.

• Work-stream tools or stand-alone appa

This type of purchase requisition software can be deployed as dedicated purchase order apps for catering to a specific function like PO approvals or vendor management. Work-stream based purchasing system software depends on approval workflows and a dedicated app interface.

Steps to Buy the Right Purchase Order Software

Once your management has agreed to invest in PO software, your procurement team needs to follow these steps.

• Step 1: Identify the need of purchase order management software
• Step 2: Involve the teams which are likely to use purchase order software
• Step 3: Set aside the budget for purchasing software
• Step 4: Research about different PO software vendors
• Step 5: Shortlist a few purchasing software vendor based on their offerings and support service
• Step 6: Get purchase management system demo
• Step 7: make the final selection and make the purchase.

Factors to Consider When Buying Purchasing Software

Integration with accounting software: Online purchase order systems must integrate with accounting solutions so that you can exercise better cost controls, save time, reduce error, and manage expenses. 

1. Flexibility: Purchasing software for small businesses and large enterprises should be flexible enough to handle the increasing number of purchase orders and multiple suppliers.

2. Logic-based computation engine: Check for a rule-based or logic-based computation engine in a PO software that helps with three-way matching and automating the payload routing process. This ensures that the right data is sent to the stakeholder.

3. Three-way matching: Purchase order management software with three-way matching capabilities is necessary. It helps improve the speed and efficiency of PO processing with conveniently matching a PO with receipts and goods.

4. Policy compliance: Best purchase order management systems make it easy for you to execute all PO functions in line with an organization's spending policies.

5. Purchasing requirements of your business: Most businesses need a purchasing software that supports functions related to purchase, supply and inventory management. Also, a PO software with features for spend management and budgeting will be useful.

Key Features of Purchasing Software

• Invoice processing: Purchase management software helps with creating, executing and processing invoice receipts for suppliers.
• Requisition management: Purchase requisition software makes it easy to manage, track and authorize purchase requests.
• Purchase order management: PO management software is ideal for preparing purchase orders and sharing them with vendors.
• Contract compliance: PO system software helps track the company's purchases to ensure that the suppliers' payments comply with the existing contract.
• Sourcing management: Purchase to pay software makes it easy to choose the right vendor for sourcing products after negotiating the best deal.
• Supplier management: A purchase order management system can be deployed for managing suppliers, maintaining conversation histories and tracking all purchases.
• E-catalogues: Purchase order management software lets you to create and customize product catalogues and manage their pricing.
• Data warehousing: Purchasing software aggregates all purchase-related data for spend analysis and reporting purposes.
• Strategic sourcing: Purchasing system software helps with strategic sourcing based on cost analysis and vendor comparison and agreement.
• ERP Integration: Most popular purchasing software can be integrated with ERP solutions to manage production planning along with procurement.
• E-Invoicing: It helps create, store and share invoices in an electronic format to ensure faster payment with higher security.
• Expense management: With rule-based approach, purchase order software ensures compliance with expense-related policies of your organization.  

Benefits of Purchasing Software

• Efficient expenditure control: Purchase to pay software helps manage the spend on different goods purchased in adherence to compliance policies and budget.
• Paperless processing: PO management software ensures that there is little to no dependency on paper for purchase order and invoices, thereby helping businesses save costs.
• Integrated reporting for better visibility: Purchase order software offers a dashboard with comprehensive reporting features for spends and expenditure analysis.
• Simplified purchasing workflows: Purchase to pay software is necessary to simplify the purchasing process with the help of a streamlined approval workflow.
• Helps manage day-to-day transactions: You can have better visibility of your daily transactions along with purchase order generated, orders processed and payments made.
• Automatically create recurring POs: Recurring purchase orders can be created automatically to fasten the purchase process.
• Helps identify the best deal: You can track the purchase history for any product to identify the best deal. Accordingly, you can negotiate with the vendor.

Who Are The Potential Users of Purchase Order Software?

Those involved in direct or indirect procurement need a dedicated purchasing software for vendor management, inventory management, etc. For indirect procurement, businesses often need a PO software that supports diverse types of purchasing.

Departmental buyers can also use purchase order management software to procure their task-related tools. Also, those who are involved in specific job roles like creating price quotes and performing job costing can use procurement order management system.

Purchasing Software Trends to Consider

• Business intelligence and machine learning algorithms: Purchase order management systems rely on business intelligence and machine learning algorithms for organizing all unstructured data related to suppliers, contracts, spends and costs. The software is also powered by chatbot technology for handling transactions and tracking payment against invoices.
• Microservices architecture: Microservices architecture is helping businesses deploy the kind of microservice most suitable for their business instead of choosing all-purpose P2P suites. It also supports the integration with all major software solutions.
• Adoption of RPA: RPA or robotic process automation is increasingly being adopted as it helps simplify various purchase to pay processes. It results in higher accuracy, cost savings and compliant purchase processes.
• Advanced analytics: Many top PO software solutions come with inbuilt advanced analytic capabilities for turning data into actionable insights. This supports unified data across departments and streamlines the daily end to end purchase processes.