How to enhance your purchase management through ERP
The benefits of ERP software are many and varied — everything from creating multiple automated systems to handling human resources tasks to organizing manufacturing and development. Yet it’s easy to get lost in all these features and forget that ERP can be a powerful asset to your company’s purchase management. While it’s true that ERP can improve business connectivity as a whole, it also provides a significant boost when it comes to purchase order writing and tracking. ERP can help enhance your supplier management by taking a lot of the ins and outs of procurement off of your plate, freeing up more time for you to focus on other areas of your business.
Let’s dive a little deeper into what the software can do for your purchase management chain, as well as how it’s affected by the Internet of Things (IoT).
How ERP assists purchase management
Think about the hours and effort that go into purchasing: creating tracking numbers, filing orders, checking inventory, making a purchase history, coordinating with suppliers, and so on. Purchase management ERP can simplify many of these tasks by automating them and providing accurate data results.
As Top 10 ERP puts it, purchase management modules can handle tasks such as purchase order writing and supplier performance tracking, among other processes. There’s also the option to create planned receipts to inventory or a job, as well as creating detailed purchase history files — “which provides continual reference to aid in making purchasing decisions”. It concludes: “With Purchase Management, you can reduce inventory levels, improve on-time deliveries, enhance your cash flow, and increase your profit levels.” It’s a far better solution than leaving delivery tracking and supplier management to employees — a system that’s highly prone to human error.
Here are some of the most useful features contained in procurement modules:
Purchase orders: As “a request to deliver something within a time constraint,” this is what every ordering system needs. ERP purchase orders can include specific lines that refer to specific items, and they can allow for multiple delivery dates to be specified.
Contract management: Referring to ERP as “the financial hub of the business” is accurate especially when it comes to managing contracts. It means that you don’t have to worry about fumbling missed deadlines or missed payments — the software module takes care of all of it for you.
Supplier database: Essential for companies that order multiple parts and materials, the ERP supplier database records suppliers and vendors that provide particular services. From names and addresses to commodities offered and tax identification data, this database collects and organizes all the supplier information you’ll need.
Supplier audits and relationship management: These two modules are separate, yet go hand in hand. Supplier audits allows you to keep tabs on the suppliers and vendors you’re in contact with, and is key to ensuring quality assurance for all materials and services. Supplier relationship management offers a spot to record audits and miscellaneous findings, as well as conversations between key parties. It’s a vital bit of ERP to keep liabilities and responsibilities on the appropriate parties.
As technology becomes more integrated with the way businesses are run, stronger importance is placed on connectivity and ensuring that any automated processes work in tandem to complete the intended tasks. ERP software creates a mainframe for an operation to run on, be it product planning, development, manufacturing, sales and marketing, and more. ERP is on the front lines of creating complete connectivity within a business, and that’s even more apparent with the birth of IoT.
Connectivity and the Internet of Things
Chances are you come in contact with IoT every day without even being aware of it. Oftentimes, IoT is connected through your smartphone; think of how an app can gather information on what store you’ve entered, or what you’ve bought after you scan a loyalty card. This is just one example of how the Internet of Things connects you and a retailer by allowing data to be exchanged and accessed.
On the purchase management side, by setting up a networked system that allows for certain pieces of data to be scanned, tracked, and collected, IoT saves you time and money by allotting automated resources rather than manual labor. Plus, you’ll end up with more accurate tracking results, which can help you determine where deliveries are and how long they’ll take to arrive. There’s also the ability to analyze purchase history, which means you’ll have a better picture of what consumers are asking for. When IoT merges with ERP, it allows you to make more logical and precise purchasing decisions that can ultimately help you grow your business.
An all-in-one solution
With all the tasks and processes that are required for purchase management, it makes sense to utilize software solutions to help take some of the load off. Not only can ERP reduce inventory errors and provide more accurate analysis of product sales, but it can also assist you in providing top-of-the-line customer service and ensure that a purchase never goes missing. It’s an all-in-one solution to help you manage your business while saving you money on labor costs as well.
Featured white papers
70 features to look for in your next ERP
A comprehensive guide to help you identify requirements for your ERP selectionDownload
ERP Software Pricing Guide
Get your comprehensive guide to the cost of ERP softwareDownload
60-Step ERP Selection Checklist
Get the comprehensive checklist for your ERP selection projectDownload
Best features for a restaurant ERP
The functionality you should look for when selecting a restaurant ERP
4 critical features to consider when selecting an ERP solution
These features should be at the top of your ERP requirements list
How to conduct a thorough ERP audit
The types of ERP audit, and step-by-step instructions on how to audit your ERP system