Expanding you market reach with Digital Procurement
While most modern B2B businesses are focusing on using digital technology to automate production, distribution, and client management processes, their procurement processes often remain stuck in analog mode. The immediate benefits of digitizing P2P processes, or digital procurement, may be harder to quantify than upgrading an assembly line to double production, yet the end results may hold as much benefit. In an effort to explain how, let’s discuss 3 ways digital procurement solutions expand market reach.
1. Streamlines global transactions to attract foreign partnerships:
Advances with online technology are opening up markets on a global level; both B2B and B2C businesses are slowly integrating the technology and mindset to take advantage of the possibilities. One of the main challenges with foreign partnerships is the complexities involved with P2P processes.
The differences in time, language, government regulations, and business practices, all have a part in making P2P transactions complex and difficult for businesses and their international partners. These challenges can be overcome with digital procurement solutions, as they digitize P2P processes with real-time automation and management controls.
By digitizing P2P processes, B2B businesses can streamline global transactions and expand their market reach. Manufacturers and distributors can both optimize their existing foreign partnerships and attract new ones when they have streamlined digital procurement solutions to offer.
An article on Bain and Company called: “Digital Procurement: The Benefits Go Far Beyond Efficiency”, written on September 10th, 2018 by Coleman Radell and David Schannon, explains more:
“Digital technologies also provide a competitive edge by improving the speed and quality of procurement, reducing the risk and enhancing innovation. As supply chains go global, they have become increasingly complicated and integrated, and the lines between suppliers, partners, and customers are blurring. Companies that harness new tools to enhance collaboration with all those stakeholders will improve their speed and agility, reducing the time from purchase order to invoice.”
2. Attracts quality suppliers and stakeholders:
While suppliers and stakeholders might be skeptical about Business Process Improvement (BPI) solutions at first, once their value is shown with optimal results, they’ll wonder how they ever did without them. Eventually, as the benefits of digital procurement solutions become universally known, suppliers and other stakeholders will prefer to partner with businesses that have them.
The aforementioned Bain and Company article explains the state of adoption:
“For workflow assignment and supplier relationship management (SRM), more than 60% have no tools or rely primarily on improvised systems using Microsoft Office.
…Unlike cloud-based technologies, traditional Microsoft Office tools don’t allow real-time collaboration.
That’s a missed opportunity in cost savings and competitiveness. Research conducted by Procurement Leaders shows that a fully automated procurement function could save Global 5000 up to $86 billion annually.”
With streamlined P2P solutions available, B2B businesses can improve existing supplier and stakeholder relationships while attracting new partnerships that appreciate their enhanced capabilities. This expands a business’s market reach and opens up lucrative new possibilities.
3. Saved time and money can be used to optimize production and strategy:
Adopting digital procurement solutions streamlines P2P processes with real-time visibility and accessibility with purchasing, inventory, invoice tracking and reconciliation, order history and management, and supplier collaboration. Fully integrated digital procurement solutions provide superior analytics and reporting solutions to further streamline P2P processes.
Essentially, B2B businesses will save time and money by eliminating redundant and cumbersome traditional P2P processes; additionally, they’ll enhance their strategic capabilities with greater visibility and control with end-to-end P2P processes.
These benefits can then be used to expand market reach and strategically improve production and operations. When supplier and stakeholder relationships take less time and involve fewer resources, other aspects of business growth can be focused on.
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