Everything You Should Look For in a Procure to Pay Solution
“Procure to pay” is the cycle in which a business requisitions, requests quotes, purchases, receives and pays for goods and services.
Procure to pay (or purchase to pay as its sometimes called) gets its name from the sequence of processes involved during the procurement of a good or service to the final steps involved in payment for those goods or services.
Procure to pay is sometimes shortened to P2P, but it shouldn’t be confused with, for example, peer-to-peer networking technology, which is also called P2P.
Most procure-to-pay processes include the following steps:
Supplier on-boarding –The method of finding, connecting to and managing supplier relationships.
Vendor selection– Researching and selecting the right vendor to purchase your required goods and services from.
Requisition – An internal process where an employee requests approval to order a goods or service.
Approval – An internal process where an approver will review an employee’s requisition and decide to approve or decline their request.
Request for quotation – Once the requisition has been approved, the procurement team may decide to order the goods / service or gather quotations from possible suppliers.
Requisition / Quotation conversion – The process of automatically converting the approved requisition or accepted supplier quotation into a purchase order.
Purchase order – The procurement team creating a legal document which contains specific order quantities and requirements for the vendor.
Receiving – Accepting the physical shipment of the goods or acknowledgement of the service being performed. Updating inventory possibly using barcode scanning technology from an ASN (advanced shipping notice).
Invoice processing / matching – Comparing the supplier’s invoice to the purchase order to ensure all costs and charges match.
Accounts payable – The final step in the procure-to-pay process is sending payment to the supplier and updating accounts payable accounting systems.
Procure to pay platform or ERP?
The above process can be very complex and company’s ERP solution may be able to handle some or most of the above-mentioned processes.
Typically, a company’s ERP system will handle the purchase ordering process, the goods receipt and the accounts payable steps.
Where i2B Connect, i2B’s procure to pay platform can handle all of the following processes and fully integrate with a company’s ERP solution where required:
- Requisition creation and subsequent approval
- Request for quotation creation / supplier portal for receiving response
- Automatic conversion of approved quotations / requisitions to purchase orders
- Purchase order delivery to suppliers
- i2B provides a cloud based supplier portal:
To allow suppliers to view / accept purchase orders
To allow suppliers to view purchase order documentation (drawing specifications etc)
To allow suppliers to create ASN (advances shipping notifications)
To allow suppliers to view deliveries, see OTD (on time delivery statistics)
To allow suppliers to upload / electronically process their invoices
Automatic posting of matched invoices to a companies ERP Accounts payable system.
And much, much more.
If you are interested in learning more about the i2B procure to pay platform, i2B Connect then please get in touch. We’d love to hear from you.